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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