- Coinbase shares spiked up Tuesday after the crypto exchange said it plans to cut more jobs.
- The stock reached a nearly one-month high after CEO Brian Armstrong outlined the decision to slash 950 jobs.
- Coinbase shares plunged 83% in 2022 as the crypto market’s valuation suffered.
The stock rose as much as 11% to $42.40, the highest price since December 13, but later pared the advance, rising 5.3% to $40.33.
The crypto exchange plans to cut 950 jobs to reduce operating expenses by 25%, CEO Brian Armstrong said in a Tuesday blog post.
“As we examined our 2023 scenarios, it became clear that we would need to reduce expenses to increase our chances of doing well in every scenario,” he wrote, referring to the bull-, bear-, and base-case crypto market scenarios it runs as part of its annual planning process.
The company had about 4,700 employees as of September. In June, it slashed its headcount by 1,100 employees, or 18% of its workforce at that point.
Coinbase shares were mauled last year, sliding 83% as the crypto market’s valuation has spiraled down from $3 trillion as prices for bitcoin, ether and other cryptocurrencies dropped. Risk assets such as crypto and stocks have been hit by recession and other macro worries. Bitcoin’s price has lost 59% over the past 12 months.
In Tuesday’s blog post, Armstrong also appeared to point to FTX founder Sam Bankman-Fried as a negative source of pressure on the crypto market. Bankman-Fried has pleaded not guilty to eight criminal charges related to the collapse of his crypto exchange.
“In 2022, the crypto market trended downwards along with the broader macroeconomy,” Armstrong wrote. “We also saw the fallout from unscrupulous actors in the industry, and there could still be further contagion.”