The cryptocurrency exchange Coinbase is cutting 18 percent of its work force amid depressed markets and concerns of a looming recession.
The company’s chief executive, Brian Armstrong, informed employees of the layoffs in a note Tuesday morning, saying the company “over-hired” its staff during a crypto boom. The company will let about 1,100 people go, reducing its work force to 5,000.
“At the time, we were in the early innings of the bull run and adoption of crypto products was exploding,” Mr. Armstrong wrote. “There were new use cases enabled by crypto getting traction practically every week.”
The company had 1,250 employees at the beginning of 2021, the note said, with Mr. Armstrong saying the number “grew too quickly.”
Coinbase said on June 2 that it would rescind job offers and extend its hiring freeze to battle the economic downturn. The layoff announcement on Tuesday signaled further stress on the platform as market drops hit cryptocurrency assets.
Benefits for employees who are laid off include at least 14 weeks’ severance pay, four months of COBRA health coverage in the United States, four months of mental health support and assistance finding new work, according to Mr. Armstrong’s memo.
“The broader market downturn means that we need to be more mindful of costs as we head into a potential recession,” Mr. Armstrong wrote on Twitter.