According to a Bloomberg report, Coinbase is reducing its employee count in Japan as part of its 20% personnel reduction initiative. A spokesperson for the Japanese branch of the exchange said that the decision is attributed to poor market conditions. The laid-off employees will receive a “comprehensive transition package,” the spokesperson said.
Regarding additional decisions, the spokesperson stated,
“No decisions have been made at this time beyond the reduction in workforce […] We are carefully evaluating all options and will communicate any further updates as they become available.”
There are no further details on who will be laid off or the timeline of the firings. For now, things remain highly uncertain for the Japanese branch of Coinbase.
Crypto winter sends a chill down Coinbase’s spine?
On Tuesday, Coinbase announced that it would let go of another 950 employees in a third round of layoffs. CEO Brian Armstrong stated that the move is an attempt to reduce operating costs by 25%.
The layoffs on Tuesday mark the third wave of employment cuts that Coinbase has made in the previous six months. Moreover, the exchange laid off 18% of its personnel in June 2022 because of the protracted bull markets that stifled its growth. A total of 1,100 people, or 18% of the workforce, were asked to quit the company. Furthermore, in November 2022, 60 employees were asked to leave the firm, beginning the second wave of layoffs. The decision came after Coinbase was hit with a $545 million third-quarter net loss. In the last six months, the popular exchange has let go of 2110 employees in total.
2022 was one of the worst years for the crypto industry. Several high-profile firms went underwater, and many saw the value of their crypto assets plummet. Moreover, the ones that did survive had to make hard decisions about letting go of their staff. Coinbase is one of many crypto firms to feel the cold of the latest crypto winter. Moreover, the larger financial picture is still very gloomy. U.S. inflation is still higher than the Federal Reserve’s 2% target. Interest rates, consequently, are still high.