Crypto exchange Coinbase announced in a blog post that it will be cutting about 25% of its operating expenses, which includes layoffs of about 950 employees. The decision was made in response to the decline in the markets and the broader macroeconomic conditions, as well as the fallout from malpractices in the industry.
The CEO of Coinbase, Brian Armstrong, stated that the company is well capitalized and the changes will ultimately benefit Coinbase in the long run, but it will take time for these changes “to come to fruition”. He added: “We need to make sure we have the appropriate operational efficiency to weather downturns in the crypto market, and capture opportunities that may emerge.”
Armstrong mentioned that the affected team members will be informed today and will be provided a comprehensive package to support them through the transition, including a minimum of 14 weeks base pay, health insurance and other benefits. Additionally, the company is providing access to Talent Hub to help connect the impacted employees with their next career opportunities.
In June 2022, Coinbase laid off 1,100 people, which at the time accounted for 18% of the total workforce. On that occasion, Armstrong attributed the layoffs to the company growing “too quickly.”
Coinbase shares are down 1.8% in pre-market hours.