One of the largest crypto exchange platforms in the world, Coinbase, is undergoing a massive round of layoffs. Coinbase co-founder and CEO Brian Armstrong said the company will cut its operating costs by 25% and let go of 950 employees.
In a business that has become emailblog post (opens in new tab) (spotted by the Forget (opens in new tab)), Armstrong said the crypto market “has gone down along with the broader macroeconomics” and that “the fallout from unscrupulous industry actors” contributed to Coinbase’s decision to increase current “operational efficiencies” at the expense of of jobs.
One of the “unscrupulous actors” Armstrong talks about is the founder of the now collapsed FTX (opens in new tab), Sam Bankman-Fried, who has been accused of fraud. (Although 2022 saw many others crypto-related bad actors (opens in new tab)and NFT scammers (opens in new tab)to be honest.)
“The collapse of FTX and the resulting contagion has left the industry with a black eye,” Armstrong said told CNBC (opens in new tab)saying there will be “more scrutiny of various companies in the space to make sure they follow the rules.”
The U.S. employees affected by the layoffs will receive a minimum of 14 weeks of severance pay and two additional weeks for each year they are with the company. Armstrong also said Coinbase will scrap projects that have a “lower chance of success”. More detailed details of the layoffs are listed in the company document 8-K archiving (opens in new tab) with the SEC.
According to Armstrong, these “dark times will also wipe out bad companies,” and “better days” are coming.
“Progress doesn’t always go in a straight line, and sometimes it can feel like we’re taking two steps forward and one back,” he wrote.
The affected employees have all been notified by email. Coinbase laid off 1,100 members in June, just four months after launch infamous Super Bowl ad. (opens in new tab)At the time, Armstrong cited over-expansion and economic downturn as causes.