The third largest cryptocurrency exchange in the world, Coinbase Global Inc. on Tuesday, 18% or about 1,100 employees laid off as the global crypto market continues to take a hit.
Why this is happening
Coinbase CEO Brian Armstrong explained that the decision to lay off some employees was due to an unexpected recession. The CEO admitted that Coinbase “grew too quickly” while they “were in the early innings of the bull run and adoption of crypto products was exploding.”
State of play
The laid-off employees were abruptly logged out of their workspaces after which they received an email from the company notifying them of their termination. The CEO explained that the reason for the unexpected approach was to prevent the departing employees from taking any rush as they had access to sensitive customer information.
- Coinbase, besides laying off employees, also rescinded offers sent to new hires and froze hiring in the near future.
What they are saying
One recruit with a rescinded offer, Ashutosh Ukey, while speaking to a news outlet said, “I would say my experience with Coinbase strayed me away from working in crypto. In the immediate future, I am looking into more long-established tech firms.”
What you should know
- The biggest cryptocurrency exchange in the United States, Coinbase announced in May that due to the steep decline in revenue, it had lost hundreds of millions of dollars. In fact, Coinbase had reportedly lost $430 million in Q1 2022, while losing over 2 million active users.
- Similarly, Tesla, a global electric car brand which has the world’s richest man, Elon Musk, as its highest shareholder, has begun the sack of over 9000 workers as the US economy continues to show signs of a crash.
- The Chief Executive Officer of Tesla Inc. and SpaceX, Elon Musk, in May projected that the US economy was in a recession and it could last for a while.
- The current crypto crash has seen the market capitalization dip to a valuation of $978 billion, down from over 11% of the $1 trillion capitalization.