Coinbase To Lay Off 950 Workers Amid Crypto Downturn

Coinbase CEO Brian Armstrong has explained in a memo to employees that the company is laying off another 950 workers seven months after eliminating 1,100 jobs

Armstrong said due to a decline in the cryptocurrency market and the general economy, he decided to lower operating expenses by 25% on a quarterly basis, which led to the layoffs.

According to its website, Coinbase has around 4,700 employees, meaning that it is letting go of over a fifth of its workforce.

Armstrong said he took responsibility for the layoffs, even though he acknowledged that some of the contributing circumstances were outside the company's control.

In retrospect, he continued, Coinbase should have released more employees in June.

The company is "fully financed and crypto isn't going anywhere," according to Armstrong, who also emphasised that recent developments like FTX's demise and clearer regulations from authorities may eventually work in Coinbase's favour.

Those modifications won't occur immediately though.

To weather market downturns and seize potential opportunities, Armstrong noted, "We need to make sure we have the necessary operational efficiency."

The management of Coinbase felt that it was important "to minimise expenses to maximise our chances of performing well in every scenario" when planning for 2023.

According to Armstrong, this is the first time that both the cryptocurrency market and the general economy have experienced a downturn at the same time.

He also points out that planning has helped Coinbase survive multiple bear markets over the past ten years.

Coinbase is cancelling several projects that had a decreased chance of success as a result of the layoffs.

Due to lower staffing, other teams will need to adapt.

According to Armstrong, the fired staff will be told today.

A compensation package of at least 14 weeks' base pay, plus an additional two weeks for every year of service, health insurance, and other benefits will be provided to affected employees in the US.

According to the company, those with work permits will receive "additional transition support."

In accordance with national employment rules, Coinbase will provide comparable assistance to discharged employees in other nations, and it will aid people who are laid off in finding new jobs.

Other problems have recently been faced by Coinbase.

According to a July report, the Securities and Exchange Commission is reportedly looking into whether the business marketed unregistered securities.

Earlier this month, Coinbase settled with a New York financial regulator for $100 million over allegations that it left the platform "vulnerable to serious criminal conduct," in part by failing to conduct enough background checks and having a backlog of flagged transactions that needed to be reviewed.