Crypto gaming startup Immutable, dubbed an "Aussie crypto star" and valued at $3.5 billion ($2.4 billion USD), laid off least 20 staff on Tuesday morning, including core members of its NFT trading card game, Gods Unchained.
The layoffs, which affected about 6% of the company's workforce, were announced Monday morning during an all-hands meeting hosted by Justin Hulog, who was appointed as chief studio officer at Immutable in March, and James Ferguson, Immutable CEO and co-founder, sources told CNET. Staff on leave were requested to attend with just 24 hours notice.
During the meeting, which was conducted via Google Meet and lasted about 30 minutes, staff were informed of impending layoffs but assured by Ferguson that Immutable is in "a fantastic position." Each member of the team then had a 15-minute meeting with a Human Resources representative and their manager during which they were told whether they would lose their job.
Staff were then told they could apply for other roles inside the company, but according to CNET's sources, the available roles weren't suitable for those who might be losing their job. Staff who didn't wish to apply for other jobs in the company were told Tuesday morning that they would be let go.
The layoffs at Immutable come as several crypto companies recede from the industry's dizzying highs of 2021. Coinbase, the largest crypto exchange in the US, laid off 18% of its workforce in June, while 20% of employees at OpenSea, the biggest NFT marketplace, were let go earlier this month.
The bulk of the layoffs centered on staff who worked on the development of Gods Unchained, sources told CNET, adding that the project was "gutted." Remaining members on the project are junior staff or C suite members. Currently, Immutable is hiring only for two positions on Gods Unchained, according to its website.
"I can confirm that Game Workers Australia is aware of the significant redundancies announced at Immutable [on Tuesday]," said Tim Colwill, convenor at trade union Game Workers Australia. "We have already begun providing assistance to our impacted members."
An Immutable spokesperson said the company "made a difficult choice" in conducting "a small reorganization within Gods Unchained to help better enable us to achieve our goal of creating the next generation of web3 games" but didn't address specific questions regarding the number of staff made redundant, nor which teams were affected by the layoffs.
The round of layoffs comes just a month after Robbie Ferguson, Immutable president and co-founder, told finance publication Blockworks "now is not the time to take our foot off the pedal."
Concurrently, Gods Unchained's player base has been dwindling. In early April, almost 22,000 unique players logged into the free-to-play game, but that number now sits at around 10,000, according to Cards Unchained, a privately run site tracking the game. According to an internal memo sent to staff on Wednesday, the reallocation of resources sees the company investing in roles to enable Gods Unchained to scale "to millions of players over the next year."
Crypto markets have been battered in 2022. In what's been dubbed "crypto winter," the price of bitcoin and ether has dropped 55% and 61%, respectively, since Jan. 1. Meanwhile, Immutable's cryptocurrency token, IMX, which is used to trade assets in Gods Unchained, has also taken a dramatic hit, with its value falling from about $11 in November 2021 to just above $1.
Despite the drop, James Ferguson told the Australian Financial Review in May that its token's value has little bearing on the business proposition of Immutable and most of its value comes from its NFT trading platform, Immutable X. The marketplace is used by companies such as GameStop and Illuvium.
Despite the layoffs, the company appears to be growing dramatically. Immutable's spokesperson said the company has grown from 120 full-time employees at the beginning of the year to a current headcount of 280, with plans to reach 360 by the end of the year.
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Updated July 26, 8:15 p.m. PT: Added internal memo on scaling Gods Unchained.