Bitcoin Processing Firm BitPay to Lay Off Staff in Order to Cut Costs

According to an email sent to all employees this morning by CEO Steven Pell, BitPay has decided to lay off employees in order to "reduce costs" and "better keep pace" in the industry.

The layoffs come amid speculation that the bitcoin payment processing company is in trouble, with bitcoin news source Qntra reporting that BitPay employees will be leaving its Atlanta office following the layoffs.

According to an email provided to CoinDesk by a company insider, Pair sent an email titled “Important Company Announcement” to the entire company, suggesting that the company may have taken layoffs without notifying employees in advance, and that he believed the day was “exciting” for the employees involved.

People familiar with the matter said more than 20 full-time employees and contractors may be laid off.

The email content is as follows:

“I urge you all to be professional , consider the situation at the company , and not let the emotions of this day get the better of you. I ’m sad to have to share this news , but it’s been a privilege to have known and worked with you all . I know [executive chairman] Tony [Gallippi] feels the same way.”

Pair also said in the email that the company will provide support and references to laid-off employees during their job search. Some employees have already met with employers in other industries, the people said.

The email concluded: "For those positions that have not been eliminated, we will be meeting later today to discuss the next steps."

One day after BitPay announced the layoffs, the company also announced that it would suspend its “free indefinite” promotional materials for new merchants.

As part of the expected start-up plan, new merchants joining now will pay a 1% monthly fee after they make more than 30 transactions. This pricing system is in contrast to rival Coinbase, which does not charge merchant fees for transactions under $1 million.

Through three rounds of financing, BitPay has raised $325 million to date, with investors including AME Cloud Ventures, Founders Fund and RRE Ventures, and angel investors including Ashton Kutcher, Ben Davenport and Roger Ver.

BitPay representatives did not immediately respond to a request for further comment.