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Crypto layoffs: Coinbase to reduce its workforce by 20% as a part of its restructuring plan
The cryptocurrency exchange platform Coinbase is laying off around 20% of its workforce. The company is facing a downturn in the crypto market and the broader economy. The CEO and Cofounder, Brain Armstrong said the layoffs come as the company aims to “weather downturns in the crypto market.”
The CEO also shared, "While it is always painful to part ways with our colleagues, there was no way to reduce our expenses significantly enough, without considering changes to headcount." In June, the company laid off about 1000 employees or approximately 18% of the workforce. Armstrong said that these job cuts are part of a plan to cut Coinbase’s operating expenses by about 25% on a quarter-over-quarter basis. He also announced that the company will shut down several projects with a lower probability of success. The first round of layoffs wasn’t enough to keep the company in a good financial position.
Coinbase Global Inc. lays off 950 employees as part of a restructuring plan that marks the third round of layoffs for the cryptocurrency exchange. The company, whose shares were up 3.3% at US$39.52, said it expects to incur about US$149 million to US$163 million in restructuring expenses. "The entire industry is going through a crisis of confidence and trading volume remains very weak. This job cut is a reflection of the current challenging environment," Oppenheimer analyst Owen Lau said. Bitcoin was lately down more than 70% and several crypto companies like Celsius, BlockFi, etc collapsed in 2022. Its founder is also facing several criminal charges. "As we examined our 2023 scenarios, it became clear that we would need to reduce expenses to increase our chances of doing well in every scenario. While it is always painful to part ways with our colleagues, there was no way to reduce our expenses significantly enough, without considering changes to headcount," Armstrong wrote. Coinbase is shutting down several projects because of a lower probability of success.