Crypto companies will need a sustainable income flow

Recently splinterlands reduced their staff count and not just splinterlands and I have been hearing about this from several companies. When the bear market starts or when cryptocurrencies start losing their value, many companies have to take tough decisions like these to reduce their headcount to manage their expenses. The same happens in the real world as well when there is a recession. In the company where I work, there is always a restriction to add additional FTE. There will be several layers of approval to find out if the new vacancy is required or not.

Sometimes these multi-layer approvals can be annoying and can also delay our progress but I thought it does help. In big MNC companies, none of the teams can recruit additional members for their team without any need. They would be questioned a lot. There will be initial pressure on doing an internal transfer to that role if there is a need. Some managers want to have more people reporting to them and that's one of the reasons why they push toward creating additional vacancies. Only the management will know if a real need and proper justification are available to get an additional resource.

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In the crypto world, things can be a little different. Some of the projects might need lots of resources during the starting phase. During the development phase, many people will have to work on a product to bring sustenance to the product. As the product gets stable, there is a high possibility that the product goes under maintenance mode and people may no longer be required for that role. This is the underlying problem if the company has only one product that is under development. If there are multiple products, the people can be shuffled to other products and they don't have to be laid off.

Managing the income flow

The companies should maintain a corpus fund to fund the employees even during tough times. Not just crypto companies and tough times can happen for any company irrespective of whether there is a recession or not there will be financial issues. If the company knows it will definitely recover, they have to continue retaining its good employees and try to compensate even during the tough times. Having a corpus fund for this is very important.

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The corpus funds can be placed as an investment and the interest gained from those funds can be used for paying the employees. If it is a crypto business, the funds should be maintained in multiple stablecoins. Even a single stablecoin is also a single point of failure. Having it spread across multiple stablecoins is also good and interest from that can be used to pay the employees.

If there is a market crash or recession, it takes a while for the stablecoins to go out of stability, the companies can plan accordingly and try to either continue or save their assets. Having some real-world passive income source is also very good for the companies to continue paying their employees. This way they don't have to send their employees out when finance is tight. Maybe the companies can slow down product development or invest in new things. But the existing things can still continue.

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