Historically, bear and bull market cycles in crypto tend to correlate with the amount of talent that enters the space.
As the all-time highs from the last two-year bull market dissipate and it seems like a new bear market is settling in, only those talented individuals with strong convictions can find the motivation to devote themselves full-time to Web3, blockchain and crypto.
During the good years of a crypto market on the rise, many curious professionals with an interest in disruptive tech have flirted with the idea of working for startups in the space.
The demand for talent usually outpaces the supply, as there is a limited amount of people with the experience required to navigate this fast-paced industry and willing to embark on a new project, the longevity of which is uncertain.
Bull markets bring talent into the space and educate new people about what can be achieved through the use of this disruptive technology. Bear markets test the conviction of even the strongest minds and reward those patient enough to stay. As the industry is expected to grow over time, it will require more talent to fuel innovation.
Raman Shalupau, founder of Crypto Jobs List — a platform for Web3, blockchain and cryptocurrency job listings — told Cointelegraph:
“I wouldn’t be surprised if bear market vibes are to continue in 2023. If we don’t see any other major collapses or regulatory surprises, we’d be likely to be entering a plateau of productivity when it comes to full-time opportunities in the industry. More clear business models and a lot of investor money in the space that is fueling a lot of land grab opportunities, all of which require human capital.”
While the crypto market continues to cool down from all-time highs and projects tighten their budgets until the next bull cycle, finding a full-time job during a bear market doesn’t look as appealing and might not be as easy as during a bullish scenario.
Current crypto job market situation
The bearish sentiment in the market can be measured by the amount of hiring going on. According to data from Crypto Jobs List, the number of job listings and talent interested in the space has declined by around 30% to 40% when compared to the hiring frenzy at the peak of the last bull market in February 2022.
November 2021 alone saw as many new jobs as the entire year of 2020. pic.twitter.com/HnQrHfbDAL
— Crypto Jobs List — Solidity NFT DeFi Web3 Jobs (@CryptoJobsList) April 22, 2022
“The hiring and demand for talent have been stabilizing the past few months. After hiring freezes and layoffs in May-June, we are seeing more companies deploying capital to hire for key positions,” commented Shalupau. “Thanks to some of the layoffs, we now have more talent that has experience in the industry.”
Demand has been affected by negative price activity. The excess of talent currently searching for a job can be a positive thing in an innovative field like Web3. This surplus in supply allows new projects to hire qualified talent that would otherwise end up at a bigger organization.
With young projects still figuring out business models and inexperienced talent learning industry requirements and best practices, it is reasonable to assume that price activity and volatility would be reflected in the number of job listings.
“Typically, right after sudden 10% or more sell-offs, there follows a period of uncertainty and caution that most companies exercise,” explained Shalupau. Of course, this would depend on the nature of the business and how the company’s treasury is managed, as many projects have allocated their funds asymmetrically between fiat and stablecoins, volatile assets like Ether (ETH) and Bitcoin (BTC) or risky yield farms in decentralized finance (DeFi).
The uncertainty that accompanies price volatility affects the willingness of professionals to invest their time and effort into a project. Having such a dynamic at play creates doubts for many professionals that think the down market is a bad time to join the industry. This might most influence professionals on the verge of transitioning into crypto full time. Shalupau said:
“Those who are still uncertain whether they can make it in crypto full time, get their doubts reaffirmed with the price drop and fear that follows it. It’s counterintuitive, but the reality is the complete opposite, a bear market is the best time to start working in crypto and find a job.”
Lessons from the previous cycle
At the top of each bull market, projects tend to chase specific technical talent to add to their team and high-level management positions such as chief technology officer are in the most demand.
From 2016 to 2018, projects had to hire Solidity developers just to put forward an initial coin offering (ICO). Then from 2021 to 2022, the race was to hire smart contract engineers to develop nonfungible token projects.
Advertised crypto salaries in crypto industry. Source: Crypto Jobs List
As demand for jobs in crypto increased, salaries also started moving up accordingly. “I believe the main driver however is the amount of VC money in the space, which is chasing a limited talent pool,” explained Shalupau:
“Projects are going for talent with a strong technical background and desire to learn crypto, rather than for talent with strong previous technical experience.”
Technical jobs such as engineering for smart contract programming languages like Solidity and Rust have increased the most, while responsibilities for these types of jobs have mainly stayed the same. The amount of work, however, might have increased, considering the number of new integrations that most projects need to perform these days.
Projects building a cryptocurrency wallet, an interchain bridge, analytical tools or DeFi products like a decentralized exchange are demanding their engineering team to provide multichain support for their products. When building a product, every piece of the puzzle has its nuances and often requires a separate approach.
Future cycles repeat and improve
The cyclical job patterns experienced during the end of the bull market of 2018 into the transition period of the following years tend to be similar to the current job landscape experienced in 2022 and what is expected to come for the following years.
With every cycle experienced by the space, the crypto job market is slowly consolidating a stable demand for talent independently of the price action in the markets.
“More projects are raising in USDC, equity and token warrants, hence the market swings don’t impact hiring plans as much as they used to in 2016–2019 when most raises were via ICO and in ETH,” Shalupau remarked, adding:
“Bear market purges all the short-term opportunistic companies, and leaves space for well-funded, serious businesses to keep hiring and building.”
Established projects can sustain hiring during downturns in the market. Proper financing allows new teams to be formed and take advantage of different skill sets that promote growth.