Coinbase, the biggest US digital-asset exchange, is laying off more staff as it seeks to cut costs to weather the crypto industry downturn.
Coinbase Global is firing about 950 employees, or 20 per cent of its workforce, as the worsening crypto slump spurs another round of layoffs at the biggest US digital-asset exchange.
Co-founder and chief executive officer Brian Armstrong announced the job reductions in a blog post, saying the steps were needed to weather the industry downturn. In June, Coinbase announced it would lay off 18 per cent of its workforce, the equivalent of roughly 1200 employees. It eliminated another 60 positions in November. It will now shut down several projects.
“This is the first time we’ve seen a crypto cycle coincide with a broader economic downturn,” Armstrong wrote in the blog. “We also reduced headcount last year as the market started to correct, and in hindsight, we could have cut further at that time.”The company expects to book $US149 million to $US163 million of restructuring charges, according to a statement. The overhaul will be “substantially complete” by the end of the second quarter, it said.
Genesis, the troubled crypto brokerage under Barry Silbert’s Digital Currency Group, also made another round of job cuts this month, cutting about 30 per cent of workforce. Crypto exchange Huobi is cutting 20 per cent of jobs, while Silvergate Capital, a crypto-friendly bank, laid off 40 per cent of its staff., dropping more than the market bellwether bitcoin, which slumped 64 per cent. The stock rose 1.4 per cent on Tuesday.
“Our preliminary view is that the announcement today will help soften the impact of the challenging environment,” Kyle Voigt, an analyst at Keefe BruyetteWoods, wrote in a note. But this “likely will not move the company into profitable territory yet”.
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