Coinbase, biggest US crypto exchange, cuts workforce by 18%

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U.S.-based cryp­tocur­ren­cy exchange Coin­base will cut its glob­al work­force by about 18% to ensure it stays “healthy dur­ing this eco­nom­ic down­turn,” CEO Bri­an Arm­strong said in a blog post.

See relat­ed arti­cle: Coin­base is the first cryp­to firm to make the For­tune 500 list

Fast facts

  • Coin­base will cut approx­i­mate­ly 1,100 employ­ees, or 18% of its staff, cit­ing an eco­nom­ic slow­down, and aims to have approx­i­mate­ly 5,000 total employ­ees by the end of its cur­rent fis­cal quar­ter on June 30, 2022, it said in a reg­u­la­to­ry fil­ing.  
  • Coin­base esti­mates it will take a restruc­tur­ing charge of as much as US$45 mil­lion to cov­er the job cuts, most­ly for employ­ee sev­er­ance and oth­er ter­mi­na­tion benefits.
  • The com­pa­ny expects to account for the charges in the sec­ond quar­ter of 2022.
  • “It’s chal­leng­ing to grow at just the right pace giv­en the scale of our growth (~200% y/y since the begin­ning of 2021). While we tried our best to get this just right, in this case it is now clear to me that we over-hired,” Arm­strong wrote in his blog post.
  • Coin­base stock was trad­ing around US$250 at the start of the year and has since fall­en about 80%. It closed at US$51.58 on June 14. 
  • At the begin­ning of 2021, Coin­base had 1,250 employ­ees and this was the ear­ly innings of the cryp­to bull run, Arm­strong wrote. 
  • The cut­backs come after Coin­base report­ed­ly raised a total of US$549 mil­lion in fund­ing over 17 rounds, and acquired 22 orga­ni­za­tions with the most recent acqui­si­tion of Btc­Turk in April this year for US$3.2 billion.

See relat­ed arti­cle: Coin­base shares extend free fall on drop in cryp­to trad­ing, loss

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