Coinbase To Cut 950 Jobs In A Fresh Round Of Layoffs
- Another round of layoffs by Coinbase, affecting 950 workers, resulted in a 25% reduction in operating costs.
- In June 2022, the exchange let go of 18% of its personnel, and 60 more employees were let go in November.
- The costs associated with the layoffs are anticipated to be recognized by the exchange in the upcoming first quarter.
According to Brian Armstrong, CEO of Coinbase, the exchange expects to lay off roughly 950 workers in order to cut operating costs by about 25% on a quarterly basis. The employees that will be let go makeup about 25% of Coinbase’s workforce.
Armstrong commented after assessing the company’s chances for 2023:
“As we examined our 2023 scenarios, it became clear that we would need to reduce expenses to increase our chances of doing well in every scenario. While it is always painful to part ways with our fellow colleagues, there was no way to reduce our expenses significantly enough, without considering changes to headcount.”
According to its 8K filing, the exchange projects that the restructuring costs associated with these actions will amount to between $149 million and $163 million. Of this, monetary charges for employee severance and other termination payments will total between $58 and $68 million. The cost of stock-based compensation for the layoffs will range from $91 million to $95 million.
In the first quarter of this year, Coinbase expenditures anticipate recognizing these costs. Armstrong cautioned there is a possibility of more spread following the impact of dishonest actors in the cryptocurrency market.
As the U.S. Federal Reserve raised interest rates to 14-year highs to combat scorching inflation, Armstrong also noted that the value of cryptocurrencies trended lower throughout 2022.
In June 2022, Coinbase laid off 1,100 employees, or 18% of its workforce, and another 60 workers in November 2022.
Genesis Trading announced a new round of layoffs last week, cutting its staff by 30%.
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