coinbase
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Coinbase will lay off 18% of staff

As crypto craters, the company said it grew too fast.

Coinbase

Coinbase CEO Brian Armstrong said the company is reducing its head count by 18%.

Illustration: Christopher T. Fong/Protocol

Crypto winter has come for Coinbase. The company is laying off 18% of its staff "to ensure we stay healthy during this economic downturn," CEO Brian Armstrong wrote in a blog post on Tuesday.

The decision is an abrupt about-face. Just weeks ago, Coinbase announced plans to triple its workforce during a first-quarter earnings call, but Armstrong said in his blog post that the company grew too fast. Coinbase expanded its team by about 200% from the start of 2021 to the start of this year. "While we tried our best to get this just right, in this case it is now clear to me that we over-hired," he said.

He also cited changing economic conditions and the need to manage costs in down markets for the layoffs. Those affected by the cuts will be notified via email. They will receive a minimum of 14 weeks' severance and an additional two weeks for every year of employment beyond one year; access to the company's health insurance for four months; and access to Coinbase's Talent Hub, where laid-off employees can look for new job opportunities.

"To our colleagues who are departing, I want to say thank you for giving everything to this company, and that I am sorry," Armstrong wrote. "I hope that as we grow again we get a chance to hire you back."

Despite Coinbase's rosy first-quarter call, the layoffs were almost a given after a subsequent series of announcements. Coinbase first announced a hiring freeze shortly after its first-quarter earnings call. Then, after assuring incoming hires that they would not be affected by the hiring pause, Coinbase changed its plans once again and took back some offers. Employees started a petition last week in protest of Coinbase's hiring and firing decisions, but Armstrong criticized them for it.

A waning crypto market is prompting layoffs across the industry. BlockFi has enacted one of the biggest layoffs among the crypto companies with plans to let go 20% of its staff. Crypto.com and Gemini also announced layoffs, while Binance is on a hiring spree. Beyond the layoffs, several crypto platforms have faced challenges as the crypto market tumbles. Over the weekend, crypto lender Celsius stopped all withdrawals and transfers.

Sarah Roach

Sarah (Sarahroach_) writes for Source Code at Protocol. She's based in Boston and can be reached at sroach@protocol.com

layoffscryptoeconomic slowdownblockfibinancecoinbase
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