- Coinbase has reduced the size of its workforce by around 18%
- After more than ten years of economic growth, Coinbase predicts a downturn
- The decision to reduce the workforce was primarily motivated by objectives to minimise costs and improve efficiency
- Coinbase has hired Arnab Kumar, a Niti Aayog executive for building Coinbase’s Indian business
To ensure that Coinbase remains healthy throughout this economic slump, the company has opted to reduce the number of its personnel by around 18% i.e. around 1100 employees. Brian Armstrong, the CEO and cofounder of Coinbase, announced the decision. This was done after discussing recent market events as well as the status of Coinbase’s business outlook with the Executive teams and Board.
Coinbase has weathered four big cryptocurrency winters, and it has built a long-term business by carefully controlling its expenditures during each downturn. Economic downturns are challenging and requires adequate strategy to mitigate the challenges.
After more than ten years of economic growth, Coinbase predicts a downturn. A recession, according to Brian Armstrong, might lead to another crypto winter, which could endure for a long time. Trading revenue, which is Coinbase’s primary source of revenue, has decreased significantly in previous crypto winters. Though it is difficult to foresee the economy or markets, Coinbase has prepared for the worst-case scenario so that it can continue to operate in any environment.
The decision to reduce the workforce was primarily motivated by objectives to minimise costs and improve efficiency. Employees who leave will get a minimum of 14 weeks of severance pay, plus an extra two weeks for each year of service beyond one year, as well as insurance and job placement assistance. The decision to cut relations with staff in this fashion, according to Armstrong, was made to protect the company’s sensitive customer data.
The crypto exchange, which went public last year with share prices nearing $350, has lost steam and is currently trading at just over $50 per share, with a market cap of around $12 billion.
Coinbase is also investing in senior management in order to expand its operations. Durgesh Kaushik, Coinbase’s Senior Director for Market Expansion, who is in charge of the company’s expansion plans in the Asia-Pacific region, Europe, Middle East and Africa (EMEA), and the Americas, announced on Twitter that the company has hired Arnab Kumar, a former Prosus Ventures and Niti Aayog executive.
Kumar will be in charge of building Coinbase Indian business.
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