Paxos has laid off approximately 20% of its staff, despite maintaining a “strong financial position,” as reported by The Block.
“We have shared the difficult decision to reduce our workforce by approximately 20%. We communicated this directly to all 65 team members,” stated Paxos co-founder Charles Cascarilla in a letter.
According to him, this move will allow the firm to “best capitalize on the vast opportunities in stablecoin tokenization.”
“With over $500 million on our balance sheet, we are in a very strong financial position to succeed,” emphasized the company’s head.
In an effort to mitigate the impact on employees, Paxos offered an enhanced compensation package: 13 weeks of severance pay, three months of health insurance coverage, and job search assistance for the same period. Additionally, the company provided a two-year extension for exercising stock options.
It is noted separately that employees participating in the quarterly bonus program received payments for the second quarter, and those on parental or sick leave received additional payments and benefits beyond the standard severance package.
Cascarilla stated that the decision was made as part of a strategy to optimize resources and focus on key development areas, such as tokenization and “stablecoins.”
“In the coming years, stablecoins will grow tenfold and serve as a cornerstone for opening up the financial system through tokenization,” he emphasized.
In conclusion, Cascarilla added that launching and scaling new products will take time. The company will concentrate on its “core offering, deprioritizing adjacent projects.”
Earlier in June, Paxos introduced the stablecoin Lift Dollar (USDL), which offers holders the right to “risk-free” returns of approximately 5%.