One of Coinbase’s most senior executives has admitted that the exchange may have to consider further job cuts should the global sell-off in the crypto market continue to worsen.
“You never say never. The only commitment we can make is that we are going to operate the company responsibly and for the long haul and if that requires additional action, we will take that”, said Faryar Shirzad, the company’s chief policy officer, at the FT’s “The Next Web” conference in Amsterdam on Friday. However, I have added that: “We don’t anticipate it at this time.”
His comments come after a turbulent week in the crypto industry, in which many exchanges have been forced to abandon their ambitious growth plans after six months of declines for popular digital currencies like bitcoin and ether.
Coinbase said this week it would cut nearly a fifth of its workforce, nearly 1,110 employees, joining rivals like Crypto.com and Gemini in making extensive lay-offs. After finishing last year with 3,730 employees, Coinbase chief executive Brian Armstrong admitted the company had grown “too quickly”.
The price of bitcoin, the most popular cryptocurrency price, has dropped by 60 per cent since its all-time high of nearly $70,000 in November. Rival asset ether has fallen even further, plunging about 70 per cent this year. The falls pushed Coinbase to a surprise first quarter net loss of $430mn but the company is committed to meeting its forecasts for the three months to June.
Shirzad said Coinbase was operating in a “very, very tough environment. “The company did what it needed to do decisively to be able to build for the long haul”, he added.
Shirzad also echoed recent controversial comments by Armstrong, who lashed out at an anonymous employee petition calling for the resignation of three senior Coinbase executives.
When asked about employee morale, Shirzad said: “If people are not happy at the company they obviously have the option to raise any particular concerns that they have. . . But also, if it’s not the right fit for them, then, you know, there are a lot of other places that they can also take their talents.”
Coinbase’s recent growth troubles sit in contrast with rival exchange FTX. CEO Sam Bankman-Fried told the Financial Times at the same conference that the exchange has no plans to cut staff.
“We’re going to keep expanding and we’ve also been careful to try and expand at a sustainable rate. We don’t have thousands of idle workers, we’ve tried to keep ourselves relatively efficient”, he said on Thursday.
Additional reporting by Cristina Criddle