Major cryptocurrency exchange Coinbase is starting 2023 with more layoffs, letting go of another 20% of its employees in a second major wave of layoffs.
Coinbase CEO Brian Armstrong officially announced on Jan. 10 that the exchange would cut 950 jobs as part of the company’s measures to reduce operating costs by around 25% amid the ongoing crypto winter.
Armstrong emphasized that Coinbase is “well capitalized” and crypto “isn’t going anywhere,” but the firm has to proceed with layoffs to keep the “appropriate operational efficiency.” As part of a headcount reduction, Coinbase will shut down several projects with a “lower probability of success,” the CEO noted, without specifying what projects will be terminated.
“In fact, I believe recent events will ultimately end up benefiting Coinbase greatly,” Armstrong stated, referring to the growing regulatory clarity and Coinbase’s opportunities due to the failure of FTX. He added:
“But it will take time for these changes to come to fruition, and we need to make sure we have the appropriate operational efficiency to weather downturns in the crypto market and capture opportunities that may emerge.”
Coinbase’s blog announcement is accompanied by the firm’s 8-K form filing with the United States Securities and Exchange Commission, which states that Coinbase’s audited financial statements for 2022 are not yet available.
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As part of the restructuring plan to reduce its operating costs, Coinbase expects to spend about 149 million to $163 million, including $58 million to $68 million in cash charges related to employee severance and other termination benefits. The Company expects the execution of the plan to be substantially complete by the second quarter of 2023, the filing notes.
The latest layoffs come months after Coinbase initially reduced its headcount by 18% in June 2022, with Armstrong citing a starting economic recession.