Coinbase is pulling back its fundraising efforts. In a memo posted to Coinbase’s site, chief people officer LJ Brock announced that Coinbase is taking a break from hiring new employees, as well as withdrawing several job openings that have already been accepted by prospective employees, citing “current market conditions and ongoing efforts to prioritize business.”
The shift comes as the cryptocurrency market continues to trend downward, dragging along the supposedly immobile stablecoins, which are pegged to a fiat currency or commodity. Coinbase began slowing down hiring in mid-May to ensure the company is “in the best position to succeed during and after the current recession,” but this move will halt hiring altogether. Brock notes that the freeze will also affect replenishments, or the employees hired to replace employees who leave the company. However, it excludes those hired to fill “security and compliance” roles.
Coinbase is also facing a lackluster response to the NFT social marketplace it launched widely in May. According to Dune Analytics data viewed by: The colorful fool† 4,132 people bought an NFT on the platform within 19 days of launch and gross sales were $875,000, or an average of $46,000 per day. It doesn’t help that NFT sales as a whole are falling, to about 19,000 sales per week in early May, as opposed to 225,000 NFT sales in September.
It’s unclear how many jobs Coinbase has withdrawn, and the company didn’t immediately respond The edge‘s request for comment. Brock says affected individuals will benefit from Coinbase’s “generous layoffs” policy and gain access to a talent hub with a variety of career resources, including interview coaching, resume review and networking opportunities.
The change at Coinbase has made it difficult for some potential employees. At least two individuals who will be hired by Coinbase say they could lose their OPT (optional hands-on training) visa due to the withdrawn offer. Others say: they received an email reassuring them that they would not lose their newly hired job due to the delay in hiring the company, only to receive an impersonal email weeks later informing them of a withdrawn offer .
Coinbase sent a welcome email to new hires 2 weeks ago with the promise that they will not withdraw offers (1st image).
Yesterday they sent the revocation emails (2nd image) leaving candidates frustrated.
We have a referral thread to help those affected pic.twitter.com/lIQe0ph4rk
— Blind (@TeamBlind) June 3, 2022
“You may have noticed this week that Coinbase posted an external blog post announcing our intentions to slow down hiring so we can re-prioritize our hiring needs against our top-priority business goals,” reads the first e-mail. mail from Coinbase to new employees. “First of all, I wanted to communicate that we are still very excited for you to join Coinbase and that we will not be withdrawing the offers from employees who have already signed or received an offer from us.”
Coinbase bolstered its workforce as part of its plan to hire 2,000 employees by 2022, saying it saw “enormous product opportunities for Web3’s future” at the time. The latest earnings report shows that Coinbase added 1,218 employees in the first quarter of 2022 alone, bringing its total workforce to 4,948.
“While we have not taken this decision lightly, given the market conditions, it is the most sensible one,” Brock said in the letter. “We will continue to evaluate all of our options to responsibly navigate Coinbase through the current cycle.”
Coinbase’s hiring freeze is an indication of colder conditions for the cryptocurrency market, and so are the layoffs at other companies on the blockchain. Cameron and Tyler Winklevoss, the twins behind cryptocurrency exchange Gemini, also announced that they will be cutting 10 percent of its workforce. The same goes for Rain, a major crypto exchange in the Middle East, which also laid off dozens of employees.
Last week, famed short-seller Jim Chanos called Coinbase “vastly overvalued” on the Corner for cryptocritics podcast (via Fortune), and forecasts its stock price to be “mid-teens” by the end of this year. Shares of Coinbase fell 9.7 percent after news of the hiring freeze was made public Friday.