Coinbase lays off 1,100 employees amid a collapse in crypto prices

Coinbase lays off 1,100 employees amid a collapse in crypto prices

Coinbase, one of the leading digital currency trading platforms, has recently sacked almost a fifth of its work staff owing to the collapse in stock and crypto prices.

According to a credible source, the layoff will lead to a cut of 18% of full-time jobs. Coinbase has approximately 5,000 full-time employees, out of which 1,100 people are being laid off.

Justifying the layoff, CEO of Coinbase, Brian Armstrong pointed toward the possibility of a recession and stated the need to manage the company’s burn rate and proliferate efficiency. He also highlighted that the company grew too quickly during the bullish market.

Coinbase is entering a possible recession after a decade long economic boom. This recession may contribute to a crypto winter and can last for a longer period.

While it seems difficult to predict the economy or the markets, Coinbase always plans out for the worst outcome so that the company can operate its business in any given environment, said Armstrong.

The crypto exchange initially announced the pause in hiring and two weeks later the company extended the hiring freeze for foreseeable future.

Armstrong also said that their employee costs are extremely high to manage the uncertain markets effectively. However, the company tried its best to get this right but according to the current market scenario it seems that Coinbase over-hired.

Emilie Choi, President and COO, Coinbase, called the layoff as an extremely difficult decision but given the market’s fall, it is the most prudent thing to do as of now.

Choi further said that the employees laid off will have access to a talent hub so that they can find new suitable jobs for themselves in the industry, including Coinbase Venture’s portfolio companies.

However, the company will still double down on certain areas like security and compliance and might reorient workers to near-term revenue drivers, said Choi.

Source Credit: https://www.cnbc.com/2022/06/14/coinbase-lays-off-18percent-as-execs-prepare-for-recession-crypto-winter.html