Cryptocurrency trading platform Coinbase will lay off 18 percent of its employees, with CEO Brian Armstrong warning of a global recession and the possibility of a “crypto winter.”
CNBC reported that Coinbase laid off about one-fifth of its entire workforce following the collapse in stock prices and cryptocurrencies. The exchange plans to cut 18 percent of full-time positions, according to an email to employees on Tuesday. The company employs approximately 5,000 full-time employees and will decrease by approximately 1,100 after the layoffs.
(SAUL LOEB/AFP via Getty Images)
(JACK GES/AFP/Getty Images)
Coinbase CEO Brian Armstrong cited a possible recession as one of the reasons for the layoffs. Armstrong also noted that the company needed to manage burnout rates and improve efficiency, and that the company was growing “very quickly” while markets were doing well.
Armstrong said in an email: “After more than 10 years of economic growth, we seem to be entering a recession. The recession could lead to another crypto winter and be long.
He added that past winters of crypto have led to a significant drop in trading activity. “While it’s hard to predict the economy or the markets, we always plan for the worst in order to do business in any environment,” said Armstrong.
Coinbase previously announced that it is freezing hiring for the “foreseeable future,” a big change from the previous year, when the company plans to add 2,000 new product, engineering, and design jobs.
“Our staffing costs are too high to effectively manage this volatile market,” Armstrong said. “It was clear that we had a lot of employees in this situation as we did our best to fix it.”
Coinbase shares are down 79% this year and 85% from their all-time high. Bitcoin has also dropped to around $22,000 this year, losing 53 percent of its value.
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Source: Breitbart
