Mercado Bitcoin is a Brazilian crypto exchange founded in 2013 which is one of the market leaders in Latin America. At its peak, it was valued at $2.1 billion and was hailed as the first "unicorn" (a startup worth more than $1 billion) crypto exchange in Brazil. Now it seems to be facing serious financial problems and is carrying out a second round of mass layoffs due to the market’s situation.
The exchange is owned by 2TM, which owns a number of blockchain-related companies, such as Bitrust, CriptoLoja and Blockchain Academy. The companies create a specific ecosystem of information platforms, exchanges and educational tools.
According to Bitcoin Portal also owned by 2TM, the company made 15% of employees jobless due to "economic problems." This may be especially due to the poor condition of the fintech sector. The statement also states that "the competitive environment continues to deteriorate" and "is unfair without the approval of a regulatory framework for digital assets."
The most recent layoffs in 2TM came in June, when 12% of the 750 employees (90) were made redundant, citing similar reasons - "a change in the outlook for the financial system."
In addition, 2TM mentioned in a statement that "the current scenario requires measures that go beyond reducing operating costs and makes it necessary to lay off some employees as well."
Stock exchange problems could be caused by a significant drop in cryptocurrency prices, which causes them to experience a large drop in interest and thus turnover, especially in poorer countries where recession and high inflation may threaten the financial situation of retail investors.
The group isn't the only entity carrying out mass layoffs. Other exchanges in Latin America are also shedding staff. Bisto laid off 80 employees at the end of May, while Buenbit laid off nearly 50% of its total workforce. The current situation is also forcing large companies such as Gemini Trust, Crypto.com and Robinhood to do the same.
According to Coingecko data, Mercado Bitcoin allows trading on 152 cryptocurrencies, the most popular of which are Bitcoin, Ethereum and ShibaInu. The volume in the last 24 hours is close to $870,000.
Consolidation continues
BTC and ETH have been moving in a sideways trend for the past 1.5 weeks, oscillating near the possible support levels of $19500 and $1530. Such a long stabilization, with the high volatility of the other markets, may indicate a temporary balance between bulls and bears, where neither side is making big moves that could lead to larger price movements.
It is a rather ambiguous sign that may indicate both reaching a neutral level for the price and talking about a potentially upcoming decisive move of these assets after the breakout from consolidation.
Rafał Tworkowski, Junior Market Analyst, Conotoxia Ltd. (Conotoxia investment service)
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