As the current bearish trends grow stronger, the leading United States cryptocurrency exchange, Coinbase, said it is planning to lay off 18% of its workforce, representing about 1,100 employees.
Coinbase Cuts Over 1,000 Jobs
Coinbase CEO Brian Armstrong revealed on Tuesday that the decision was made in preparation for a recession that could result in a long crypto winter.
“We appear to be entering a recession after a 10+ year economic boom. A recession could lead to another crypto winter, and could last for an extended period. While it’s hard to predict the economy or the markets, we always plan for the worst so we can operate the business through any environment,” he said.
He also cited other reasons, including managing costs during the crypto down market. Armstrong said that Coinbase over-hired during the last bull market, when the company witnessed significant growth and reducing its workforce now will help increase efficiency during the bear market.
The exchange noted that it will be sending emails to affected staff and that they will receive severance pay of up to 14 weeks. Additionally, laid-off staff will have access to the company’s Talent Hub program to enable them to secure employment at other firms.
Earlier this month, Coinbase announced that it will be extending its hiring pause as well as revoking several job offers already accepted. The company had previously revealed that it would slow down hiring following a devastating $430 million first-quarter loss this year.
Crypto Firms Cut Jobs Amid Winter
Meanwhile, it’s not just Coinbase that plans to reduce its workforce in preparation for the crypto winter.
Coinfomania reported yesterday that crypto lending platform BlockFi will reduce its headcount by 20%. Other crypto-related companies including CryptoCom, Gemini, and Rain Financial have also reduced their workforce.
But unlike other firms, Binance and Ripple are onboarding new talents to improve their workforce. Both companies said they have strong war chests to survive the crypto winter and expand hiring.