Coinbase Latest Crypto Firm To Cut Costs Amid Market Downturn

Coinbase is hoping to weather the current market downturn by pursuing cost-cutting measures including a freeze on new hires

article-image

Source: Nasdaq

share

key takeaways

  • Coinbase is the latest crypto giant to join the ranks of others seeking to cut costs to operations
  • The exchange provider is citing macroeconomic factors and a shrinking crypto market as reasons for its move

Coinbase said Thursday it was pausing hiring efforts and rescinding a number of accepted employment offers as it squares off with challenging macroeconomic conditions and a downturn in the crypto market.

In a company post penned by Chief People Officer L.J. Brock, Coinbase has decided to take more “stringent measures” to slow its headcount growth in hopes of navigating uncertain waters.

The exchange provider joins a growing number of crypto companies pursuing similar cost-cutting measures amid shrinking profit margins and capital.

Also Thursday, Winklevoss-founded exchange Gemini said it was axing 10% of its staff, citing crypto’s current “contraction phase” that’s now “settling into a period of stasis.” In April, Seychelles-registered exchange BitMEX also did away with roughly a quarter of its workforce, while Latin America’s Bitso shed 11%.

Alongside the hiring freeze, Coinbase said it would rescind offers previously granted to “talented people” yet to start their positions with the company, offering a “severance philosophy” to offset financial loss.

“On our Q1 earnings call, we discussed that headcount and a variety of other expenses are the key ways for us to manage our costs,” Brock said in the post. “While we did not make this decision lightly, it is the prudent one given market conditions.”

The executive also said that while Coinbase always knew crypto would be volatile, current conditions coupled with “larger economic factors” may yet test the company and its personnel.

While market downturns are not uncommon — the industry most recently experienced similar conditions in 2018 through to 2020 — the current slump of capital inflows and investor sentiment has forced companies to pause and consider.

Coinbase, Brock said, is hoping to weather the storm by remaining flexible and resilient in the face of uncertainty.


Don’t miss the next big story – join our free daily newsletter.

Tags

Upcoming Events

HYATT REGENCY SALT LAKE CITY

TUES, OCT. 8, 2024

Guided by the expertise of Blockworks Research Analysts team, this one day event will feature senior leaders, entrepreneurs, and developers from across the crypto industry. Attendees will have the opportunity to participate in an immersive experience to explore the latest trends, […]

Salt Lake City, UT

WED - FRI, OCTOBER 9 - 11, 2024

Pack your bags, anon — we’re heading west! Join us in the beautiful Salt Lake City for the third installment of Permissionless. Come for the alpha, stay for the fresh air. Permissionless III promises unforgettable panels, killer networking opportunities, and mountains […]

recent research

hivemapper.jpeg

Research

We believe crypto market participants overlook Hivemapper’s fundamental potential due to a poor understanding of both the niche map data market and Hivemapper’s positioning relative to incumbents. Hivemapper’s token model catalyzes both a cost and product advantage via unmatched map freshness and near real-time accuracy, which is its wedge into a market characterized by stale data and high data collection costs. Its current and potential future product suite may represent one of the strongest possibilities for PMF in crypto today.

article-image

The Fidelity Ethereum Fund, like other proposed ETH ETFs, seeks to stake a portion of its assets, according to the firm’s Wednesday registration statement

article-image

The DAO first voted on enabling SAFE transfers over a year ago

article-image

The final Bitcoin halving, where the mining reward becomes smaller than one satoshi, is expected to occur in 2140

article-image

The Department of Justice and Commodity Futures Trading Commission announced back-to-back lawsuits against KuCoin Tuesday

article-image

Judge Failla found that Coinbase didn’t operate as an unregistered broker in offering its wallet service

article-image

A fund by Laser Digital offers investors exposure to the Polygon network, while a new 21Shares ETP focuses on staking rewards from Toncoin