The Chief Executive Officer (CEO) of the crypto exchange Coinbase, Brian Armstrong has recently highlighted through a blog that they would cut down their global workforce by 18% in order to make sure that the crypto entity remains healthy during the economic downturn.
The US-based cryptocurrency exchange would eliminate around 1,100 employees which equates to 18% of its workforce. This is due to the economic downtrends, and its objective is to have around 5,000 employees in total by the end of its current fiscal quarter on June 30 this year.
The exchange predicts that it would take a reconstructing charge of approximately $45 Million to cover the job cuts, mostly for the employee severance and other termination benefits. The entity expects to account for all the charges in the second quarter of 2022.
According to Brian Armstrong who highlighted in his blog post, it is challenging to grow at just the right pace, given the scale of their growth. And while they tried their best to get this just right, in case it is now clear to him that they over-hired.
The stock of coinbase was trading at approximately $250 when the year started and has then fallen by 80%. As of June 14, it closed at $51.58.
The crypto exchange had 1,250 employees at the start of the year 2021. And according to the CEO, this was the early innings of the strong bull run.
The slash came following the exchange reportedly securing about $549 Million in funding for more than 17 rounds. And had also carried out various acquisitions.
The recent crypto market downtrends have prompted a lot of crypto entities to look over their operations and work again as they are impacted in some way or the other. Coinbase was one such impacted entity. And this move of easing up on its workforce seems to be taken in order to deal with the economic slowdown. It is to look forward to how the crypto market would perform further.
Source: https://www.thecoinrepublic.com/2022/06/15/prominent-us-exchange-coinbase-to-trim-its-personnel-by-18/