Just four months ago, Coinbase reportedly spent $14 million on a Super Bowl ad that consisted almost entirely of a colorful QR code bouncing around the screen, pointing viewers to a website where they could get $15 in cash. Bitcoin just by signing up. Now its fortunes have turned so much that it will lay off about 1,100 employees, or 18% of its workforce, according to a filing with the United States Securities and Exchange Commission.
In a company blog post, Coinbase CEO Brian Armstrong first blamed changing economic conditions that could lead to a “crypto winter” and waited until his third point to mention that the company had been “over-hiring,” citing its attempt to take advantage of “new use cases enabled by crypto that is gaining traction virtually every week.”
2/ We have also grown quite rapidly over the past two years and have started to operate less efficiently at our new size. It will take us some time to adapt to this new scale before we grow again.
— Brian Armstrong – barmstrong.eth (@brian_armstrong) June 14, 2022
16/ If you are unhappy with something, work as a team to raise it with proposed solutions (it’s easy to be a critic, harder to be part of the solution). If you can’t do it and you’re going to run away / rant outside, stop. Thanks!
— Brian Armstrong – barmstrong.eth (@brian_armstrong) June 10, 2022
four days ago, Armstrong responded on Twitter to an employee petition calling for the removal of Coinbase executives, calling it “really stupid on many levels” and encouraging employees unhappy with the situation or proposed solutions to resign.
The employee petition cited issues that don’t sound as silly as Armstrong claimed, calling on the company to “aggressively hire for thousands of positions, despite it being an unsustainable plan.” and contrary to the wisdom of the crypto industry”. He didn’t mention the Super Bowl promotion, but he did note over-prioritization of certain projects. It starts with the Coinbase NFT platform which launched with what seems like exceptionally bad timing given a drop in activity in the overall market, and which failed to catch on among people. who trade the digital tokens.
In May, the the wall street journal reported that company executives including Armstrong, its co-founder Fred Ehrsam, President and COO Emilie Choi, and CPO Surojit Chatterjee had made $1.2 billion in stock sales since the Coinbase IPO in April 2021. Shares of the company opened at a price of $382, and are currently trading at around $52.
This staff reduction comes after Coinbase began canceling job offers that had already been accepted by candidates. The sudden change even left some visa holders in limbo, as well as others who had ignored other opportunities or managed to quit their previous jobs. In a report yesterday, Motherboard counted more than 300 people whose offers were cancelled.
Other cryptocurrency companies like BlockFi, Crypto.com, and Gemini have also announced layoffs recently, after the price of Bitcoin has fallen in each of the past twelve weeks and is now hovering around $21,884 after falling. peaked at around $69,000 last November.
In the blog post, Armstrong states, “Within the next hour, each employee will receive an email from HR advising them whether or not you are affected by this layoff.” Those terminated will receive at least 14 weeks of severance pay plus an additional 2 weeks for each year of employment after their first, plus four months of COBRA health insurance in the United States and four months of mental health support worldwide , as well as access to its talent hub which is supposed to try to help them find new jobs.
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Cryptocurrency exchange Coinbase lays off 18% of its workforce
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