Coinbase CEO Brian Armstrong plans to cut an additional 20% of its workforce in order to manage operating expenses amid the ongoing bear market and FTX contagion. Coinbase slashed 18% of its workforce in June last year and will layoff an additional 950 employees as part of the latest decision. The crypto exchange had 4,700 employees at the end of September.
In a blog post on January 10, Coinbase CEO Brian Armstrong announced reducing operating expenses by about 25% quarter-by-quarter. It includes laying off about 950 people. He believes the company needs to reduce operating expenses, which can’t be done without considering changes to headcount.
Further, Coinbase plans to shut down several projects with a lower probability of success. Other projects will continue to operate as usual, with fewer people on the team. The details on the 2023 scenarios and expense outlook will be shared in a public 8-K filing today and the Q4 earnings call in February.
Those affected received an email to their personal account. Coinbase is offering a comprehensive package to support fired employees. US-based employees will receive a minimum of 14 weeks of base pay, health insurance, and other benefits. Also, the company plans to provide extra transition support for impacted employees on a work visa.
“We’re also giving everyone access to our Talent Hub to help connect you with your next career opportunity. Coinbase employees are among the most talented in the world, and I’m certain that your skills and experience will stand out, even in a challenging job market.”
Recently, Coinbase was downgraded by analysts at financial services firm Cowen. Crypto companies face increased scrutiny following the collapse of FTX and the overall decline in trading volumes in the crypto market.
COIN price fell over 2% in pre-market trading hours, with the current price trading near $37.42. The stock price saw a 15% jump on Monday amid the crypto market recovery.
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