American multinational e-commerce company eBay has reportedly laid off 30% of its staff from its NFT (non-fungible token) marketplace and Web3 division. According to a source close to the matter, Stef Jay, the company’s business and strategy officer, has resigned.
The e-commerce giant stepped into the Web3 realm by acquiring KnownOrigin, a UK-based NFT marketplace, in June 2022. The NFT marketplace’s team and IP became a part of eBay’s Web3 division.
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A few months after the KnownOrigin acquisition, the e-commerce firm purchased the trading card marketplace TCGplayer for $295 million.
However, despite its massive entry into NFTs and Web3, the company seems to be changing direction.
Will eBay exit the NFT and Web3 market?
According to reports, the relationship between the e-commerce giant and KnownOrigin did not go in the right direction. According to a source, ‘Many within the company are unhappy, blaming the lack of leadership and strategy for the layoffs. There are internal criticisms, even at senior levels, questioning the qualifications of the current head of web3 as well as eBay’s strategy team.‘
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The NFT market has seen a significant decline since its 2021 peak. The value of several NFT collections has drastically dwindled. According to a September 2023 study, 95% of NFT collections were found to be worthless. The decline in demand and value may have pushed eBay to rethink its Web3 and NFT strategy.
However, it is also possible that the company is reorganizing its Web3 division for smoother operations. Tech companies, including Meta, Amazon, etc., laid off thousands of employees over the past few years. The slow economy and the aftermath of the COVID-19 pandemic may have played a hand in the mass layoffs. eBay’s 30% layoff of NFT and Web3 staff may be due to a similar reason.