Cryptocurrency exchange Coinbase is the latest tech company to announce mass layoffs. In an email to staff on Tuesday, CEO Brain Armstrong said the company would be letting 950 employees go as it attempts to “weather downturns in the crypto market.” The email was made public on the Coinbase blog, and the company also submitted an 8-K filing with the news.
“The FTX collapse and the resulting contagion has created a black eye for the industry”
“While it is always painful to part ways with our fellow colleagues, there was no way to reduce our expenses significantly enough, without considering changes to headcount,” Armstrong wrote in his memo. Employees in the US will receive a minimum of 14 weeks base pay plus two additional weeks per year spent at the company. Affected employees will receive an email today.
“The FTX collapse and the resulting contagion has created a black eye for the industry,” Armstrong told CNBC, and suggested that more pain may be yet to come. “We may not have seen the last of it — there will be increased scrutiny on various companies in the space to make sure that they’re following the rules… Long term that’s a good thing. But short term, there’s still a lot of market fear.”
Coinbase’s layoffs come amidst a broader downturn in the crypto market. The value of Bitcoin has plummeted in recent months, and is down around 58 percent over the past year according to CNBC. Coinbase’s shares have trended in a similar direction since going public in April 2021. Its stock is trading at under $40, down from a high of over $340 in 2021.