Coinbase will cut 1,100 staff in anticipation of crypto winter
Company costs associated with the layoff of 1,100 employees will amount to about $40-45 million.
According to CEO and co-founder Brian Armstrong, the reorganization aims to maintain business stability during the economic downturn.
The Coinbase CEO believes the industry is entering a recession, which could cause a new crypto winter lasting for a long time. He also noted that recent staff growth has reduced the company's efficiency.
“We have now exceeded the limit of how many new employees we can integrate while growing our productivity. For the past few months, adding new employees has made us less efficient, not more. We have seen ourselves slow down considerably due to coordination headwinds, and difficulty fully integrating new team members. We believe the targeted resourcing changes we are making today will allow our organization to become more efficient,” wrote Armstrong.
Coinbase plans to complete its reorganization this quarter. Employees affected by the layoff will receive a minimum of a 14-week severance package. The company will also provide COBRA health insurance in the U.S. and psychological support worldwide for 4 months.
In May, Coinbase announced it was suspending the hiring of new employees, and in early June, it reported that it was revoking some already signed contracts. However, back at the beginning of 2022, the company announced its intention to triple the staff.
In early June, Gemini, an American cryptocurrency exchange, announced that it was laying off 10% of its employees.
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