US SEC “Abuse Of Power” Cited as Consensys Cuts Work Force By 20%

Consensys, the Ethereum-focused blockchain technology firm and creator of the MetaMask wallet, has announced a 20% reduction of its workforce, impacting approximately 162 employees. Founder and CEO Joseph Lubin attributes these layoffs to both the broader macroeconomic challenges and regulatory pressures from the U.S. Securities and Exchange Commission (SEC).

MetaMask Creator Consensys Reduces Staff, Citing SEC Scrutiny

In a recent blog post, Consensys outlined its decision to reduce staffing by 20%, impacting around 162 employees across multiple divisions. The company attributed this decision to heightened macroeconomic pressures, including increased inflation and tighter liquidity conditions. 

Additionally, Consensys, known for creating MetaMask, one of the most widely used decentralized crypto wallets, has faced challenges partly due to US SEC scrutiny. According to CEO Joseph Lubin, regulatory actions from the US SEC have forced the company and others in the industry to bear significant legal costs. These cases often lead to extended legal battles, impacting companies’ operational budgets and slowing innovation in the sector.

Joseph Lubin stressed, 

“Such attacks from the US government will end up costing many companies that have been investigated, sued, or sent Wells Notices, many millions of dollars.”

More so, Lubin noted that US SEC lawsuits have led to “lost jobs and halted productive investments” across the blockchain industry. However, CEO Lubin emphasized that Consensys remains committed to supporting Ethereum’s mission and working toward decentralization.

The US SEC has been actively pursuing cases against crypto firms, creating uncertainties. Most industry leaders have expressed disappointment with the regulatory body, citing its negative impact on business growth and innovation. For instance, in the ongoing Ripple vs. SEC lawsuit, Ripple has had to adjust its legal representation, with executives Brad Garlinghouse and Chris Larsen hiring key lawyers ahead of the appeal.  

Amid these challenges, Consensys has focused on aligning its strategy with core business areas while controlling operational costs. Lubin expressed that maintaining financial resilience under these market conditions is crucial for the company’s long-term sustainability.

The CEO added, 

“To stay competitive, we need to reshape ourselves to be more agile, more effective, and even higher-performing.”

Road to Decentralization Remains on Track

Despite workforce reductions, Consensys reaffirms its commitment to decentralization.. According to Lubin, the company’s long-term vision is to evolve into a “Network State,” transitioning into a loosely coupled structure of teams to drive innovation.

This shift toward decentralization, supported by projects like MetaMask and Linea, aims to reinforce the decentralized web3 ecosystem. Moreover, the creator of the MetaMask wallet envisions enhancing its cross-chain capabilities and launching new features, including the MetaMask card, to broaden its utility. 

Joseph Lubin stated, 

“Over the coming weeks, we’ll be making concrete announcements that demonstrate this commitment to decentralization.”

Adding to the US SEC’s ongoing industry-wide disputes, Coinbase recently filed an Amicus Brief in support of the DeFi Education Fund. As part of its stance, Coinbase argues that the US SEC has inconsistently applied regulatory standards to the crypto sector, creating ambiguity.

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Ronny Mugendi

Ronny Mugendi is a seasoned crypto journalist with four years of professional experience, having contributed significantly to various media outlets on cryptocurrency trends and technologies. With over 4000 published articles across various media outlets, he aims to inform, educate and introduce more people to the Blockchain and DeFi world. Outside of his journalism career, Ronny enjoys the thrill of bike riding, exploring new trails and landscapes.

Disclaimer: The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.