06-17-2022, 12:59 PM
‘We Grew Too Quickly’: Coinbase Downsizes amidst ‘Economic Downturn’
<p>Coinbase, an American cryptocurrency exchange, is pruning its
workforce by 18% in preparation for a recession it says could lead to another
crypto winter.</p>
<p>A crypto winter is a period of a downward spiral in cryptocurrency prices. </p>
<p>Brain Armstrong, Coinbase’s Chief Executive Officer and Co-Founder, made the decision public on Tuesday in a message published on the exchange’s blog. </p>
<p>“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 said in the statement.</p>
<p>Coinbase’s action comes two weeks after Gemini, a rival cryptocurrency exchange, also shed 10% of its staff, citing “current macroeconomic and geopolitical turmoil.”</p>
‘Economic Conditions Are Changing Rapidly’ <p>In the statement, Armstrong explained that economic conditions are changing rapidly and a recession could lead to another crypto winter which could last for an extended period. </p>
<p>The CEO noted that trading revenue, the exchange’s largest revenue source, slumped significantly during previous crypto winters. </p>
<p>“While it’s hard to predict the economy or the markets, we always plan for the worst, so we can operate the business through any environment,” he said. </p>
<p>Speaking further, the Co-Founder of Coinbase noted that the exchange “grew too quickly,” and had "over-hired" while trying to take advantage of the explosion in the adoption of crypto products.</p>
<p>Armstrong pointed out that managing the exchange’s costs is, therefore, critical in down markets.</p>
<p>“Coinbase has survived through four major crypto winters, and we’ve created long term success by carefully managing our spending through every down period,” the CEO said. </p>
<p>“Down markets are challenging to navigate and require a different mindset,” he added.</p>
'Employee Costs Are too High'
<p>Explaining how the job cut decision was reached, Armstrong noted that the exchange’s team had grown very quickly in fourfold over the past 18 months. </p>
<p> He added that the firm’s employee costs are too high to effectively manage in “this uncertain market.”</p>
<p>Moreover, Armstrong explained, “For the past few months, adding new employees has made us less efficient, not more. </p>
<p>“We have seen ourselves slow down considerably due to coordination headwinds, and difficulty fully integrating new team members. </p>
<p>“We believe the targeted [resource] changes we are making today will allow our organization to become more efficient.”</p><p></p>
This article was written by Solomon Oladipupo at www.financemagnates.com.
https://www.financemagnates.com/cryptocu...-downturn/
<p>Coinbase, an American cryptocurrency exchange, is pruning its
workforce by 18% in preparation for a recession it says could lead to another
crypto winter.</p>
<p>A crypto winter is a period of a downward spiral in cryptocurrency prices. </p>
<p>Brain Armstrong, Coinbase’s Chief Executive Officer and Co-Founder, made the decision public on Tuesday in a message published on the exchange’s blog. </p>
<p>“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 said in the statement.</p>
<p>Coinbase’s action comes two weeks after Gemini, a rival cryptocurrency exchange, also shed 10% of its staff, citing “current macroeconomic and geopolitical turmoil.”</p>
‘Economic Conditions Are Changing Rapidly’ <p>In the statement, Armstrong explained that economic conditions are changing rapidly and a recession could lead to another crypto winter which could last for an extended period. </p>
<p>The CEO noted that trading revenue, the exchange’s largest revenue source, slumped significantly during previous crypto winters. </p>
<p>“While it’s hard to predict the economy or the markets, we always plan for the worst, so we can operate the business through any environment,” he said. </p>
<p>Speaking further, the Co-Founder of Coinbase noted that the exchange “grew too quickly,” and had "over-hired" while trying to take advantage of the explosion in the adoption of crypto products.</p>
<p>Armstrong pointed out that managing the exchange’s costs is, therefore, critical in down markets.</p>
<p>“Coinbase has survived through four major crypto winters, and we’ve created long term success by carefully managing our spending through every down period,” the CEO said. </p>
<p>“Down markets are challenging to navigate and require a different mindset,” he added.</p>
'Employee Costs Are too High'
<p>Explaining how the job cut decision was reached, Armstrong noted that the exchange’s team had grown very quickly in fourfold over the past 18 months. </p>
<p> He added that the firm’s employee costs are too high to effectively manage in “this uncertain market.”</p>
<p>Moreover, Armstrong explained, “For the past few months, adding new employees has made us less efficient, not more. </p>
<p>“We have seen ourselves slow down considerably due to coordination headwinds, and difficulty fully integrating new team members. </p>
<p>“We believe the targeted [resource] changes we are making today will allow our organization to become more efficient.”</p><p></p>
This article was written by Solomon Oladipupo at www.financemagnates.com.
https://www.financemagnates.com/cryptocu...-downturn/