SAN FRANCISCO (UPI) — Coinbase, one of the world’s top cryptocurrency trading platforms, announced Tuesday it will be laying off more than 900 workers in the face of slowing global interest in digital currencies.
The company, the first crypto exchange to be publicly traded, blamed “market conditions” for its move to eliminate about 950 jobs. It said in the Securities and Exchange Commission filing that it will incur $149 million to $163 million in restructuring efforts, including severance packages and termination benefits.
“As we examined our 2023 scenarios, it became clear that we would need to reduce expenses to increase our chances of doing well in every scenario,” Coinbase CEO Brian Armstrong said to employees in a message Tuesday.
“While it is always painful to part ways with our fellow colleagues, there was no way to reduce our expenses significantly enough, without considering changes to headcount. As part of a headcount reduction like this, we will be shutting down several projects where we have a lower probability of success.”
Armstrong said other projects will continue to operate as normal with fewer people on the team.
“The estimates of the charges and expenditures that the company expects to incur in connection with the plan, and the timing thereof, are subject to a number of assumptions, including local law and consultation requirements in various jurisdictions, and actual amounts may differ materially from estimates,” Coinbase said in the filing.
The announcement comes as the company started to face recent financial headwinds. Earlier this month, the New York State Department of Financial Services said Coinbase will pay $50 million to settle charges it failed to conduct proper background checks on new user accounts and another $50 million to bolster its compliance program.
Last July, former Coinbase product manager Ishan Wahi, his brother Nikhil Wahi and friend Sameer Ramani were charged with insider trading for a scheme in which they planned to trade ahead of announcements on which crypto assets would be made available for trading on the platform.
The news also comes after another cryptocurrency exchange FTX Group announced Chapter 11 bankruptcy and its CEO Sam Bankman-Fried jailed on fraud accusations.
Clyde Hughes, based in Atlantic City, N.J., curates the biggest breaking news of the day from around the United States and the world. He holds a communications degree from Lamar University in Beaumont, Texas and has studied race reporting at the Poynter Institute. He is a longtime, but often disappointed, fan of the Dallas Cowboys and Houston Astros.
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