In the wake of the cryptocurrency market crash, Coinbase this week said it was joining a number of tech companies by delaying its hiring plans for this year. More details have emerged about Coinbase’s efforts to cut costs after The Information received emails sent to employees.
The company is said to have frozen hires for two weeks (although it will honor offers already sent) and put new projects on hold. It is also reportedly trying to reduce how much it spends on hosting services.
In addition to not hiring as many people this year as previously expected, Coinbase is trying to minimize employee turnover. According to the report, the company is giving employees more shares. Shares of Coinbase have fallen more than 75 percent in the past six months.
Coinbase is said to have paused some projects, such as a corporate banking initiative, as it focuses on increasing revenue from core products, including retail and institutional trading. It reportedly plans to offer retail customers more cryptocurrencies and expand operations outside of the US.
When asked for comment, a Coinbase spokesperson sent Engadget to a tweet thread from chief product officer Surojit Chatterjee. As the company refocuses on its “high-impact products” and seeks to “improve efficiencies by seeking improvements in developer productivity,” Chatterjee noted that Coinbase has no plans to stop investing in strategic and venture technologies. projects. “We believe the down market is a good time to build for the longer term,” Chatterjee wrote.
The company announced in its first quarter earnings report last week that net sales declined 27 percent year-over-year at $1.16 billion and more than halved from the previous quarter. The trading volume also fell. Amid a hiring wave (more than 1,200 new employees are said to have come in this year), operating expenses rose nine percent from the previous quarter to $1.7 billion. Coinbase had a net loss of $430 million in the first quarter. That was all before the cryptocurrency market collapsed earlier this month.
Stablecoin TerraUSD (which is believed to be pegged to the value of the US dollar) and sister token Luna effectively collapsed, causing a ripple effect for other cryptocurrency prices. Although it has recovered somewhat since then, the price of bitcoin also plunged below $26,000 for the first time in 16 months amid a sell-off that wiped more than $200 billion off the crypto market in a single day.
Coinbase’s shift in recruiting strategy reflects a broader trend among prominent tech companies. Meta and Uber are among the big companies cutting costs and delaying hiring plans. Meanwhile, Netflix fired about 150 employees in the US this week and canceled some animation projects. The company’s stock plunged after it reported its first quarterly subscriber decline last month.
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