Coinbase Slashes Workforce by 20% Amid Extended Crypto Winter

Publicly-traded cryptocurrency exchange Coinbase announced Tuesday that it plans to reduce its workforce by 20%. With the move, the firm joins a bandwagon of crypto firms in a second round of layoffs.

In June 2022, Coinbase slashed its workforce by 18%, representing around 1,100 workers. The move was taken to tackle its finances during a broader market downturn.

Coinbase Reduces Workforce by 20%

The total number of employees that Coinbase is laying off is about 950 workers. Brian Armstrong, the CEO and co-founder of Coinbase, noted that the latest move is part of the firm’s current action to cut down on “operational expense.” 

The CEO added that the affected employees had already been removed from gaining access to the internal system of Coinbase. The move, Armstrong noted, was a way to protect customers’ information.

As with its previous layoff, the American-based exchange “will [provide] a comprehensive package to support” the affected workers, regardless of their geographical location. One of them includes assisting laid-off employees with seeking new jobs.

While preparing for the possibility of any market outcome in 2023, Armstrong stated that Coinbase would also shut down projects that have lesser chances of yielding results. More information on the company’s expense outlook is expected to be released later today.

Armstrong: Large Competitor Failure Will Benefit Coinbase

The fallout of top crypto platforms has contributed immensely to the current market conditions.  Armstrong claims these downfalls will eventually benefit his crypto exchange. How so?

At its peak, the once-giant FTX controlled a global user base of over 5 million active users. However, since its dramatic collapse in November 2022, FTX has lost users’ trust.

The Coinbase boss believes that users of FTX and other trading firms affected by FTX’s collapse will flock to other exchanges like Coinbase. However, only time will tell if such will ensue.

Crypto Companies Lay Off Workers

Aside from Coinbase, several other crypto platforms have reduced their workers. Only four days ago, crypto lending firm Genesis downsized its workforce by 30%, leaving the firm with only 145 employees.

Earlier this month, crypto-focused bank Silvergate reduced its workforce by 40%, representing over 200 workers.