Coinbase To Cut 18% of Workforce, CEO Wary of Potential Recession

Coinbase’s decision to cut jobs comes less than two weeks after the firm said it would pause hiring and rescind job offers

article-image

Blockworks exclusive art by axel rangel

share

key takeaways

  • CEO Brian Armstrong warned a “crypto winter” could hurt the firm’s trading revenue
  • The crypto exchange “grew too quickly” and “over-hired” since 2021, he said

Coinbase will slash its workforce by 18% in anticipation of a recession, said CEO Brian Armstrong on Tuesday.

“Today I am making the difficult decision to reduce the size of our team by about 18%, to ensure we stay healthy during this economic downturn,” Armstrong wrote in a blog.

Armstrong warned changing economic conditions are signaling the onset of a recession, which could lead to another extended downturn — otherwise known across the industry as “crypto winter.”

During the past crypto winters, Coinbase’s trading revenue suffered, he added. Armstrong also said the firm had “over-hired” since 2021 to leverage the opportunities available in the crypto market.

In a regulatory filing, Coinbase said 1,100 employees would be affected by the reduction plan. At the time of the announcement, its employee headcount last stood at over 4,900 on its website. The filing also shows the firm expects to incur between $40 million to $45 million in total restructuring expenses.

Indeed, trading volumes make up more than 90% of Coinbase’s overall revenue (based on 2020 disclosures). In this year’s first quarter, Coinbase trading volumes fell short of analyst estimates, dropping to $309 billion from $335 billion in the same period the year prior.

Revenue for the first quarter also came in lower than expected at $1.17 billion. Furthermore, the firm reported a net loss of $430 million, compared to a profit of $767 million the year before. This has weighed heavily on Coinbase’s share price.

The company was valued at more than $86 billion when it went public in April last year. Coinbase stock has trended downward ever since — from its initial listing price of $382 to under $50 during pre-market trade on Tuesday, where it slipped more than 5%. Coinbase’s market value is now just over $11 billion.

“Even for the most contrarian of investors, it’s never nice to see this much blood on the streets,” Tim Frost, CEO of Yield App, told Blockworks.

“While plenty predicted the kind of levels that bitcoin is now facing, few anticipated the journey. Within one short month, we’ve seen the loss of one of the industry’s biggest projects [Terra], while some of the most established names are now beginning to waiver. It is certainly enough to put all but the most battle-hardened investors on high alert.”

The announcement comes less than two weeks after Coinbase said it would freeze hiring and rescinded a number of accepted job offers.

Other crypto companies have been slashing costs by reducing their workforce. Crypto.com, Gemini, BitMEX, Buenbit, Bitso have all recently announced layoffs amid tumbling cryptocurrency prices.

[stock_market_widget type=”accordion” template=”chart” color=”#5D25E5″ assets=”COIN” start_expanded=”true” display_currency_symbol=”true” api=”yf” chart_range=”1mo” chart_interval=”1d”]


Get the news in your inbox. Explore Blockworks newsletters:

  • Blockworks Daily: The newsletter that helps thousands of investors understand crypto and the markets, by Byron Gilliam.
  • Empire: Start your morning with the top news and analysis to inform your day in crypto.
  • Forward Guidance: Reporting and analysis on the growing intersection of crypto and macroeconomics, policy and finance.
  • 0xResearch: Alpha directly in your inbox. Market highlights, data, degen trade ideas, governance updates, token performance and more.
  • Lightspeed: Built for Solana investors, developers and community members. The latest from one of crypto’s hottest networks.
  • The Drop: For crypto collectors and traders, covering apps, games, memes and more.
  • Supply Shock: Tracking Bitcoin’s rise from internet plaything worth less than a penny to global phenomenon disrupting money as we know it.
Tags

Upcoming Events

Industry City | Brooklyn, NY

TUES - THURS, JUNE 24 - 26, 2025

Permissionless IV serves as the definitive gathering for crypto’s technical founders, developers, and builders to come together and create the future.If you’re ready to shape the future of crypto, Permissionless IV is where it happens.

Old Billingsgate

Mon - Wed, October 13 - 15, 2025

Blockworks’ Digital Asset Summit (DAS) will feature conversations between the builders, allocators, and legislators who will shape the trajectory of the digital asset ecosystem in the US and abroad.

recent research

morpho 2 graphic.png

Research

Utilizing a ‘DeFi Mullet’ approach, Coinbase’s Bitcoin-backed loans integration with Morpho demonstrates a powerful blueprint for CEXs to monetize dormant assets by expanding adoption of wrapped products (cbBTC, USDC) while also supporting native and/or preferred DeFi ecosystems (Base) which can further lead to downstream growth in onchain liquidity and increased utilization of the related assets.

article-image

President Donald Trump announced a 10% levy on almost all goods and additional tariffs on so-called “worst offending” countries

article-image

Solana may be in “recomposition” mode, as new protocols put usefulness ahead of mere virality

article-image

The stablecoin issuer will have to contend with bigger players and the interest rates environment

article-image

The president reportedly was still working on his tariff policy plans late Tuesday evening

article-image

The chain could mark a turning point in bitcoin’s utility

article-image

Should higher-fidelity graphics be the goal for crypto games — which result in much higher costs and risk?