The crypto bloodbath is leading to massive job culls across the industry, with cryptocurrency exchange Coinbase announcing that as many as 1,100 employees will be fired. The jobcut at Coninbase accounts for 18 percent of its workforce, Reuters reported. The company revealed the cost cutting measure in an 8-K filed by it on Tuesday.
The jobcuts will be effective as soon as June 30, the filing said. The coin exchange will be left with 5,000 staff once the workforce reduction comes into force.
The announcement came even as the cryptocurrency markets was bracing for more losses in the event of another interest rate hike by the US Federal Reserve.
End of 10 Plus Years of Boom
"We appear to be entering a recession after a 10+ year economic boom. A recession could lead to another crypto winter, and could last for an extended period. In past crypto winters, trading revenue (our largest revenue source) has declined significantly," Coinbase Founder and CEO Brian Armstrong said. He added in the blog post that the company grew too quickly.
Coinbase jobcuts come close on the heels of similar developments across the industry this week. Crypto lender Blockfi and the exchange Crypto.com said on Monday they are forced pare jobs.
Crypto.com also said it was letting go around 260 of its employees.
In a shock announcement BlockFi said it was cutting approximately 20% of its workforce as it was dealing with a 'dramatic shift in macroeconomic conditions'.
Over the past month, the total value of crypto assets fell as much as 25 percent, dropping from around $1.24 trillion to $929 billion.
The jobcuts at Coinbase have surprised the market participants as the company had said at the beginning of the year that it planned to triple its headcount.
According to the company, the current layoffs will cost the company nearly $40 million to $45 million in restructuring expenses.
"Coinbase has survived through four major crypto winters, and we've created long term success by carefully managing our spending through every down period ... Down markets are challenging to navigate and require a different mindset," Armstrong wrote.