Bessie Liu

<div id="highlights-block_62d06d1ffd2de" class="highlights">
 <ul>
 <li>Devin Finzer says OpenSea will still have five years of runway</li>
 <li>“The reality is that we have entered an unpreceded combination of crypto winter and broad macroeconomic instability.”</li>
 </ul>
 
</div>



Co-founder and CEO of NFT marketplace OpenSea Devin Finzer <a href="https://twitter.com/dfinzer/status/1547648521607659522?s=20&amp;t=mqTiUa2AZNrt1oNCJZnm8g" target="_blank" rel="noreferrer noopener">announced on Twitter</a> today that the company will be downsizing its staff by 20%.



“Each of the people leaving has played a critical role in OpenSea’s journey,” Finzer wrote. “The reality is that we have entered an unpreceded combination of crypto winter and broad macroeconomic instability, and we need to prepare the company for the possibility of a prolonged downturn.



OpenSea says that it will provide its laid-off employees with “generous severance, healthcare coverage in 2023, and accelerated equity vesting for those who haven’t hit their cliff.” Finzer noted he also plans to help departing staff with their job search through personal networks where possible.



The layoffs will place OpenSea in a position to maintain five years of runway through a crypto winter, according to Finzer.&nbsp;



“With the hard (but important) changes we made today, we’re in an even better position to capture what will soon become the largest market on the planet…Winter is our time to build,” he wrote.



OpenSea joins a slew of prominent crypto companies scaling back headcounts during the bear market.&nbsp;



The start of June saw crypto exchange Gemini <a href="https://cms.blockworks.co/gemini-joins-growing-list-of-crypto-exchanges-cutting-staff-amid-downturn/" target="_blank" rel="noreferrer noopener">let go of 100 employees</a> — an estimated 10% of its staff — alongside Singaporean-based Crypto.com, which <a href="https://cms.blockworks.co/crypto-com-cutting-5-of-workforce-amid-digital-asset-downturn/" target="_blank" rel="noreferrer noopener">cut 5% of its workforce</a>, a 260 headcount reduction. Weeks later, BlockFi <a href="https://cms.blockworks.co/cryptocurrency-lender-blockfi-set-to-cut-staff-by-a-fifth/" target="_blank" rel="noreferrer noopener">shared the news</a> that it will be slashing staff by 20%, and Coinbase announced it would lay off <a href="https://cms.blockworks.co/coinbase-latest-crypto-firm-to-cut-costs-amid-market-downturn/" target="_blank" rel="noreferrer noopener">18%</a> of its employees. 



There had been indications that the <a href="https://cms.blockworks.co/crypto-deleveraging-cycle-wont-last-much-longer/" target="_blank" rel="noreferrer noopener">most vulnerable</a> times in crypto were over, earmarked by venture capital firms <a href="https://cms.blockworks.co/despite-slow-q2-vc-dollars-are-coming-back-to-crypto/" target="_blank" rel="noreferrer noopener">trickling money</a> back into the space. OpenSea’s layoffs may suggest that the crypto winter is far from over.



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Devin Finzer

OpenSea Lays Off 20% of Staff

Ornella Hernandez

<div id="highlights-block_6297ac2cee459" class="highlights">
 <ul>
 <li>The case is considered to be first indictment in a digital asset insider trading scheme</li>
 <li>Chastain resigned as OpenSea’s product manager in September</li>
 </ul>
 
</div>



The Department of Justice has indicted former OpenSea head of product Nathanial Chastain with insider trading in connection to NFTs in Manhattan federal court on Wednesday. Chastain was charged with one count of wire fraud and one count of money laundering.



<a href="https://www.justice.gov/usao-sdny/pr/former-employee-nft-marketplace-charged-first-ever-digital-asset-insider-trading-scheme" target="_blank" rel="noreferrer noopener">According</a> to the indictment, Chastain was accused of buying dozens of NFT (non-fungible tokens) with the prior knowledge that the assets would be featured on the NFT marketplace.&nbsp;



He then sold them at a profit two to five times the original purchase price using anonymous digital currency wallets and anonymous accounts on OpenSea.



Reuters <a href="https://www.reuters.com/technology/opensea-employee-charged-with-insider-trading-nfts-2022-06-01/" target="_blank" rel="noreferrer noopener">reported</a> that Chastain acquired up to 45 NFTs between June and September 2021.



US Attorney Damian Williams stated that “NFTs might be new, but this type of criminal scheme is not,” adding that Chastain’s “betrayal” and other insider trading crimes would be stamped out — “whether it occurs on the stock market or the blockchain.”



Chastain <a href="https://cms.blockworks.co/openseas-nate-chastain-calls-it-quits-after-insider-trading-allegations/" target="_blank" rel="noreferrer noopener">resigned</a> from his position after being suspected of profiting from insider information in September 2021. His suspicious wallet activity on Etherscan was initially flagged by perceptive Twitter users.



A spokesperson for OpenSea told Blockworks that Chastain was asked to leave because his behavior was &#8220;in violation of our employee policies and in direct conflict with our core values and principles.&#8221;



OpenSea admitted that an employee used inside knowledge to outsmart the market, and the company’s CEO Devin Finzer publicly accepted Chastain’s resignation in a blog post. At the time, Finzer claimed that OpenSea put new rules in place to protect against this.



This case is being handled by the Office’s Securities and Commodities Fraud Task Force, with investigation aid from the National Cryptocurrency Enforcement Team.



Each of the charges carry a potential maximum sentence of 20 years in prison.



Update on June 6, 2022 at 1:49 pm ET: Chastian was asked to leave OpenSea before his resignation.



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Damian Williams

Former OpenSea Exec Charged With NFT Insider Trading

Jacquelyn Melinek

<div id="highlights-block_61d7689c0f2ca" class="highlights">
 <ul>
 <li>The total trading volume across 14 NFT marketplaces rose close to 23,000% year-over-year, from $85.7 million 2020 to $19.6 billion in 2021</li>
 <li>The total market cap of NFTs is about $31.4 billion, making up 1.53% of the current $2.05 trillion total market cap for cryptocurrency</li>
 </ul>
 
</div>



OpenSea overall monthly NFTs sales may be down from September 2021 all-time highs, but its Polygon-based NFT sales hit a peak of about $2 million during December, and are starting off the new year strong, according to <a href="https://dune.xyz/queries/130838/257589" target="_blank" rel="noreferrer noopener">data</a> compiled by user niftytable on Dune Analytics.



As of Thursday, there were 426,565 non-fungible token (NFT) Polygon sales in January. If this number continues to grow at the same rate, there will be about 2.2 million Polygon NFT sales for the month of January, a 10% increase from the previous month and nearly 5,000% higher than six months ago.



Polygon’s <a href="https://www.coinbase.com/price/polygon#:~:text=The%20current%20price%20is%20%242.5787,circulating%20supply%20is%207%2C086%2C960%2C741.27%20MATIC." target="_blank" rel="noreferrer noopener">MATIC</a> token spiked near all-time highs to $2.92 on Dec. 26, 2021, but was down 29.2% from that record level to $2.26 on Thursday.



In general, 2021 was an extremely strong year for NFTs. The total trading volume across 14 NFT marketplaces, including OpenSea, Rarible, Axie Infinity, SuperRare, NBA Topshot, rose from $85.7 million in 2020 to $19.6 billion in 2021, according to a <a href="https://www.1confirmation.com/2021-nft-annual-review?latest" target="_blank" rel="noreferrer noopener">report</a> by cryptocurrency-focused investment firm 1confirmation.&nbsp;



<figure class="wp-block-image"><img decoding="async" src="https://lh6.googleusercontent.com/1Rpkt33hLzN1mVWkVMoGvJvLyrNqMj_DAsBLrG_EEko-t72k2l7aKx_cNh6qvG0tLUHkir9bYv_rxvs_QOtOF74csrJ4zTdIzDStExlOWicZUPaVkbop4P2PktpoHpyjspmMYBcu" alt=""/><figcaption>Source: 1confirmation</figcaption></figure>



“NFTs had a breakout year in 2021 but the asset class is still small relative to cryptocurrency broadly,” the 1confirmation report noted.



The total market capitalization of NFTs is about $31.4 billion, making up 1.53% of the current <a href="https://coinmarketcap.com/" target="_blank" rel="noreferrer noopener">$2.05 trillion</a> total market cap for cryptocurrency, according to data from 1confirmation and CoinMarketCap, respectively.&nbsp;



However, the investment firm said it thinks NFTs will ultimately be larger than cryptocurrencies by the end of this decade and steps taken by NFT creators in 2022 will contribute to that growth. “2021 was crazy in NFT land, and 2022 is shaping up to be crazier,” 1confirmation stated.&nbsp;



<h3 class="wp-block-heading">OpenSea sailing ahead</h3>



OpenSea, the largest NFT marketplace by trading volume, is showing no sign of slowing down in 2022. This week, the company announced a <a href="https://opensea.io/blog/announcementops/announcing-openseas-new-funding/" target="_blank" rel="noreferrer noopener">$300 million Series C</a> funding round led by Paradigm and Coatue. The latest capital raise gives OpenSea a $13.3 billion post-money valuation.



<meta charset="utf-8">“In 2021, the world woke up to the potential of NFTs to unlock utility and economic empowerment across a vast set of industries, communities and creative categories,” Devin Finzer, CEO of OpenSea, told Blockworks. “Our vision is to be the destination for these new open digital economies to thrive. We’ll start this year by lowering the barriers to entry to the NFT space on OpenSea and investing in the ecosystem and the community that powers it,&#8221; Finzer added.



Today, OpenSea has over 1.26 million active users, 2 million collections and over 80 million NFTs. It offers cross-blockchain support across Ethereum, Polygon and Klatyn. OpenSea Polygon traders have increased to record levels from just 15 users in late June 2021 to over 846,433 users as of Thursday, niftytable’s <a href="https://dune.xyz/queries/130852/257620" target="_blank" rel="noreferrer noopener">data</a> on Dune Analytics showed.&nbsp;



Total OpenSea Ethereum traders have also hit new all-time highs — from 36,540 on the year-ago date to 942,721 as of Jan. 5, <a href="https://dune.xyz/queries/2877/5680" target="_blank" rel="noreferrer noopener">data</a> compiled by user rchen8 on Dune Analytics showed.&nbsp;



“We saw the NFT ecosystem explode last year, with OpenSea’s transaction volume increasing over 600x in 2021,” Finzer wrote in a blog <a href="https://opensea.io/blog/announcementops/announcing-openseas-new-funding/" target="_blank" rel="noreferrer noopener">post</a> on Tuesday. “But we’re just getting started,” he added.&nbsp;



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Axie Infinity

OpenSea Polygon NFT Sales On Track to Hit 2.2M by End of January

Morgan Chittum

<div id="highlights-block_61ae863f50eec" class="highlights">
 <ul>
 <li>Roberts worked at Lyft for seven years and is known for playing a large role in helping the company go public in a multi-billion dollar IPO</li>
 <li>OpenSea has processed over $10 billion in gross merchandising sales</li>
 </ul>
 
</div>



OpenSea, the largest non-fungible token (NFT) marketplace, has appointed former Lyft executive Brian Roberts as the start-up’s first Chief Financial Officer (CFO), according to a <a href="https://www.bloomberg.com/news/articles/2021-12-06/former-lyft-cfo-roberts-joins-crypto-startup-opensea" target="_blank" rel="noreferrer noopener">report</a> by Bloomberg on Monday. 



“I haven’t been this excited about something in a very long time,” he told Bloomberg. “It reminds me of 1995 eBay.”



Along with OpenSea’s newest hire, the marketplace may be trying to secure additional funding, Chief Executive Officer (CEO) Devin Finzer confirmed to Bloomberg. Both OpenSea and Roberts have declined to comment further on the matter.&nbsp;&nbsp;



Although it’s the tech veteran’s first foray into cryptocurrency full time, he is already planning on how to take the company public.



<blockquote class="wp-block-quote is-layout-flow wp-block-quote-is-layout-flow">“When you have a company growing as fast as this one, you’d be foolish not to think about it going public,” he said. “It would be well-received in the public market, given its growth.”</blockquote>



During his seven years at Lyft as CFO, the company saw $7 billion in capital raised, along with a successful initial public offering (IPO).



“While I have no intention of changing my license plate from GOLYFT, it is time for me to find new challenges in a new space,” Robert wrote in a <a href="https://www.linkedin.com/posts/brianrobertspublicprofile_after-7-memorable-years-helping-lyft-scale-activity-6872282166626283520-pe_N" target="_blank" rel="noreferrer noopener">LinkedIn post</a> on Friday. “This will be my next great journey to learn, grow and help shape the future.”



The hiring report follows a whirlwind of a year for OpenSea.&nbsp;



Amid <a href="https://cms.blockworks.co/openseas-nate-chastain-calls-it-quits-after-insider-trading-allegations/" target="_blank" rel="noreferrer noopener">insider trading allegations</a> that shook the marketplace and ultimately led to a resignation from former Product Head Nate Chastain, the start-up has also experienced explosive growth in 2021. 



Founded in 2017,&nbsp; the platform has processed over $10 billion in gross merchandise value and has a valuation of roughly $12 billion. In August, OpenSea became the first NFT marketplace to hit $1 billion in monthly trading volume.



Specifically, trading volume on the platform was over $200 million in August compared to an average of less than $100,000 last December, according to DappRadar.



“Over the next few years we’ll help build a brand new, open, digital economy,” Finzer said in a <a href="https://opensea.io/blog/announcements/introducing-brian-roberts-our-new-cfo/" target="_blank" rel="noreferrer noopener">blog post</a> on Monday. “I couldn’t be more optimistic about the future.”



Lyft Inc. stock closed on Monday&#8217;s news 6.28% higher, at $41.95 per share.




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