As part of CEO Brian Armstrong’s efforts to streamline Coinbase and put greater emphasis on artificial intelligence, the cryptocurrency exchange will be eliminating 700 positions, or around 14% of its staff.
The down market affected Coinbase’s quarter-to-quarter revenue, and fast breakthroughs in AI are altering the way teams operate, according to Armstrong’s note to staff.
According to him, the company’s structure would be streamlined to a maximum of five levels below the CEO and COO. Leaders will be expected to take on the role of “player-coaches” instead of traditional managers, and focus on smaller teams that are natural to AI and can use automated technologies to boost productivity.
Multiple Factors Combined
In order to help their employees weather the storm, the company is offering a generous benefits package, according to Armstrong. This includes 16 weeks of base pay for US employees, additional pay depending on tenure, their next equity vest, and six months of “COBRA” (Consolidated Omnibus Budget Reconciliation Act), among other things.
These layoffs reveal that Coinbase, one of the biggest US crypto firms, views AI not only as a tool to boost productivity, but also as reason to reevaluate its management, team structure, and staffing practices.
In response to deteriorating market circumstances, economic concerns, and the increasing use of AI in internal processes, Coinbase has joined other crypto startups in recent months in reducing its employment.
Reuters reported in February that as part of a larger effort to reduce costs, Gemini announced plans to leave the UK, EU, and Australia and lay off up to 200 employees, or around 25% of its staff.