Is the “crypto winter” coming ?: the largest company in the sector will lay off 1,100 people

coinbase Global, the largest cryptocurrency trading site, announced this on Tuesday will cut 18% of its workforce, or around 1,100 jobs, according to an email sent to its employees, to cut costs amid the crash of virtual currencies and the downturn in financial markets.

The cryptocurrency exchange was hit by extreme volatility due to economic and geopolitical uncertainties such as rising inflation and the impact of the war in Ukraine, with bitcoin falling as much as 14% on Monday after sites like Celsius and Binance have blocked withdrawals and transfers.

“It looks like we are entering a recession after an economic boom of over 10 years. One recession could lead to another crypto winter and could last for a long time“Company executive director Brian Armstrong said in the publication, according to Reuters news agency.

Without going into which departments would be interested, Armstrong said employees would receive an email. “in the next hour” From Human Resources informing them if they had been affected by the dismissal.

“Although it is difficult to predict the economy or the markets, we always plan for the worst to be able to carry out the activity in any environment ”, added the CEO of the company.

Coinbase, which said so earlier this year planned to hire 2,000 people in several locations, he had initially suspended that expansion.

“Our employee costs are too high to effectively manage this uncertain market,” Armstrong said. “While we did our best to get it right, in this case now It is clear to me that we hire excessively ”.

Coinbase went public last April, during the cryptocurrency boom and investor demand for tech documents so booming. But the company’s shares are down 79% this year and 85% from an all-time high. Meanwhile, bitcoin has dropped to around $ 22,000 and has lost 53% of its value this year.

Coinbase, based in San Francisco, experienced a drop in users in the last quarter and a 27% drop in revenue from the previous year. The company derives most of its profits from transaction fees, which are closely related to trading.

Other layoffs

In the past week, the Bitso stock exchange has announced the dismissal of 80 employees of the 600 it has globally. The company operates in 35 countries. The measure has reached Argentina, considered one of the most promising markets.

Days later, another cryptocurrency trading platform, Buenbit, announced the sacking of nearly half of its staff and the brake on its ambitious regional expansion plan.

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