Coinbase lays off another 950 workers amid crypto market downturn

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Coinbase is laying off another 950 employees, seven months after cutting 1,100 jobs. In a memo to staff, company CEO Brian Armstrong said amid a downturn in the crypto market and the economy in general, he called for operating expenses to be cut by $25. % quarter over quarter resulting in layoffs. Coinbase says on its website that it has over 4,700 employees, so it’s getting rid of about a fifth of its staff.

While acknowledging that some of the factors that led to the layoffs were beyond the company’s control, Armstrong said he took responsibility for them. He added that in hindsight, Coinbase could have let more people come back in June.

Armstrong said the company is “well capitalized and crypto isn’t going anywhere,” and noted that recent events such as the collapse of FTX and clearer rules from regulators could benefit Coinbase in the long run. However, these changes will not happen overnight. “We need to ensure that we have the appropriate operational efficiencies to weather downturns in the crypto market and seize opportunities that may emerge,” Armstrong wrote.

When planning for 2023, Coinbase management determined that there was a need to “reduce expenses to increase our chances of doing well in all scenarios.” Armstrong notes that this is the first time the crypto market and the wider economy have experienced a downturn simultaneously, adding that planning has helped Coinbase survive several bear markets over the past decade.

Due to the layoffs, Coinbase is canceling some projects that had less chance of success. Other teams will have to adapt to have a smaller squad. Armstrong said employees who are terminated will be notified today.

Affected workers in the United States will receive compensation of at least 14 weeks of base pay with an additional two weeks per year of service, health insurance and other benefits. The company says it will provide “additional transition support” to work visa holders. Coinbase will provide similar support to laid-off workers in other countries in accordance with local employment laws and help those laid off find their next job.

Coinbase has had to deal with other issues lately. In July, it was reported that the Securities and Exchange Commission was investigating the company to find out if it was selling unregistered securities. Earlier this month, Coinbase reached a $100 million settlement with a New York financial regulator over allegations that it made the platform “vulnerable to serious criminal behavior” in part by neglecting to performing enough background checks and having a large backlog of flagged transactions to review.

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