SuperRare Labs, the firm behind the nonfungible token marketplace SuperRare, has become the latest casualty of falling NFT markets when Chief Executive John Crain announced Friday the marketplace would cut about 30% of its staff.

Crain tweeted a message he sent to employees on the company’s Slack stating that the company “grew in tandem with the market” when it was booming and that the “aggressive growth was unsustainable” now that markets are faltering.

I have some tough news to share: pic.twitter.com/iLDKqgyhQa

— SuperRare John 💎 (@SuperRareJohn) January 6, 2023

“[W]e over-hired, and I take full ownership of this mistake,” Crain said. “To correct course, we’ve made the difficult decision to rightsize our team, ensuring that SuperRare Labs will be able to continue serving our community of artists, collectors, and curators while remaining the destination for the best cryptoart in the world.”

Nonfungible tokens, or NFTs, are a type of blockchain-based crypto asset that can represent the ownership of intangible items such as digital artwork, music, videos, video game items, concert tickets and more. These ownership tokens can be bought, sold and traded for cryptocurrency, which in turn can be traded for money.

The NFT market was explosive in previous years, soaring to tremendous highs in late 2021 alongside cryptocurrency markets. The market rose to $41 billion in value in 2021, up from $100 million in 2020. However, the advent of “crypto winter,” which crashed markets in 2022, saw markets fall precipitously. A report from Reuters showed that NFT markets fell 60% during the third quarter of 2022 from the second quarter, to $3.4 billion.

SuperRare isn’t the only NFT marketplace to get hit with layoffs during 2022. It follows OpenSea, the largest marketplace by volume, which laid off 20% of its staff in July, and Dapper Labs, the developer of the NFT marketplace NBA Top Shot, which laid off 22% of its staff in November.

The cryptocurrency markets have also faced turmoil as prices continue to fall, bringing down major industry players as well. Just a week into 2023, several crypto companies have been cutting employee counts, including Silvergate Capital and crypto lender Genesis laying off 40% and 30% of their staff, respectively. The crypto exchange Huobi also cut 20% of its staff, citing poor markets.

“We know there is much innovation and transformation yet to come for Web3, NFTs, cryptoart, decentralized finance and governance,” Crain said. “We are facing headwinds, yes – but there remains an incredible uncaptured opportunity as we continue building something totally new: a global digital art renaissance that is transparent, fair and that anyone can access anywhere in the world.”

Crain added that the company would do everything it could to help employees affected by layoffs to find new opportunities and support them in the industry.

Image: Pixabay