In a surprising development, Kucoin, the renowned cryptocurrency exchange, has reportedly initiated a round of job cuts, citing the need to address concerns over dwindling profits. Although the company has described the action as a “normal performance appraisal,” insider sources claim that the layoff is a direct consequence of the recently updated Know Your Customer (KYC) policy.

According to reliable information obtained from three internal employees, Kucoin is planning to let go of approximately 30% of its workforce. This move comes on the heels of the exchange’s implementation of mandatory KYC measures for its users. As revealed by Chinese reporter Colin Wu, the revised policy seems to have adversely impacted the company’s financial performance, prompting the need for cost-saving measures.

While Kucoin has yet to release an official statement regarding the reported job cuts, the Seychelles-based firm has indicated that the staff reduction is part of their ongoing commitment to compliance and focus on core business development. Despite the absence of official confirmation, the move has sparked discussions within the cryptocurrency community, raising questions about the potential ramifications of the new KYC policy.

Interestingly, this development comes after Kucoin publicly denied rumors of job cuts in July 2022, asserting their intention to bolster their workforce by 30%. The recent shift in their stance has left many speculating about the underlying reasons for this apparent change in strategy.

As the cryptocurrency market continues to face regulatory scrutiny worldwide, Kucoin’s job cuts are reminiscent of the recent layoffs at the United States arm of rival exchange Binance. The latter reportedly downsized its workforce in preparation for a protracted and costly legal battle with the Securities and Exchange Commission (SEC).

The impact of Kucoin’s staff reduction on the company’s future remains to be seen. Nonetheless, market observers are closely monitoring the situation as the exchange strives to strike a balance between compliance measures and maintaining profitability in the ever-evolving crypto landscape.