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Crypto exchange platform, Coinbase layoffs 18% staff

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Employees were terminated with 14 weeks of severance pay.

American cryptocurrency exchange platform, Coinbase on June 14 announced that it would lay off nearly one-fifth of its workforce, which is 18% of staff. The reason behind such a step is tight economic conditions, and the cryptocurrency market grew too rapidly.

In an email to its employees, Coinbase CEO Brian Armstrong said that this percentage cut would affect about 6,000 employees. They were immediately terminated with 14 weeks of severance pay.

Crypto bank Celsius has stated that it will temporarily be halting all the transactions, fearing panic withdrawals would affect the company’s liquidity.

People mount questions every day about the company’s solvency and business practices.

Crypto enthusiasts may dismiss Celsius as an exception. But Coinbase is an industry leader, and its crisis hints at the industry’s health. The company, which claims to have 98 million members, is one of the most popular methods to purchase and sell crypto assets, and warnings about its business portend harsher implications about the future of crypto as an investment class.

Armstrong stated that a recession could lead to another crypto winter that may last long.

Coinbase’s decision comes as recession fears grow, IT stocks are on the verge of collapse, and most concerning for the crypto world, the two most popular coins plunge. Bitcoin and Ethereum had dropped 27 percent and 33 percent of their value over the preceding five days as of Tuesday afternoon.

It comes after the collapse of Terra’s financial goods last month, which pulled down the market’s value.

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