Coinbase announced on Thursday that it was halting hiring efforts and rescinding a number of accepted job offers as it grapples with difficult macroeconomic conditions and a crypto market collapse.
Coinbase has decided to take additional "stringent steps" to halt its personnel growth in order to navigate uncertain waters, according to a corporate post written by Chief People Officer L.J. Brock.
In the face of dwindling profit margins and capital, the exchange provider joins an increasing number of crypto firms implementing similar cost-cutting strategies.
Also on Thursday, Gemini, the Winklevoss twins' cryptocurrency exchange, said that 10% of its personnel would be laid off, citing the current crypto climate as being in a "contraction phase" that is now "settling into a period of stasis." BitMex, a Seychelles-based exchange, let off approximately a quarter of its staff in April, while Bitso, based in Latin America, shed 11%.
Along with the employment embargo, Coinbase said it would revoke offers made to "talented people" who had yet to start and would use a "severance mindset" to compensate for the financial loss.
"We stated that personnel and a range of other expenses are the major methods for us to manage our costs on our Q1 results call," Brock added in the post.
"While we did not make this decision lightly, given market conditions, it is the prudent one."
While Coinbase has always anticipated that cryptocurrency would be volatile, the executive believes that current conditions, combined with "larger economic factors," will put the company and its employees to the test.
While market downturns are not uncommon – the industry most recently experienced similar conditions from 2018 to 2020 – the current unwinding of capital and investor sentiment has forced companies to pause and consider their options.
Brock stated that Coinbase hopes to weather the storm by remaining flexible and resilient in the face of uncertainty.
DISCLAIMER
The author's or anyone else's views or opinions expressed in this article are for informational purposes only and do not constitute financial, investment, or other advice. Investing in or trading in crypto assets carries a financial risk.
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