Crypto Market Sluggish, Coinbase Cancels Hiring New Employees

Coinbase shares in the sluggish crypto market of late. (photo: twitter @coinbase)

JAKARTA – Difficult times for crypto currencies are now at hand. Various efforts have been made by crypto exchange agents in the world, in order to stay safe and avoid crises. For example Coinbase is pulling back on its recruiting efforts.

In a memo posted to the Coinbase website, chief people officer LJ Brock announced that Coinbase was delaying hiring new employees. They even canceled some job offers that candidates had received. They reasoned “current market conditions and ongoing business priority efforts.”

The shift occurs when the cryptocurrency market continues to trend downwards, dragging a supposedly immobile stablecoin, pegged to a fiat currency or commodity, with it. Coinbase started slowing hiring in mid-May to ensure the company is “best positioned to succeed during and after the current downturn,” but this move halted hiring completely.

Brock noted that the freeze would also affect backfills, or employees hired to replace workers who leave the company. This does not include those hired to fill roles in "security and compliance".

Coinbase is also competing with a lackluster response to the social NFT marketplace that launched widely in May. According to data from Dune Analytics seen by The Motley Fool, 4.132 people purchased NFT on the platform within 19 days of its launch, and gross sales totaled USD 875.000, or an average of USD 46.000. million) per day.

That number did not increase the overall declining NFT sales. In fact, the number continues to fall to around 19.000 sales per week in early May, compared to 225.000 NFT sales made in September 2021.

It's unclear how many job offers Coinbase canceled. They did not immediately respond to The Verge's request for comment. Brock said affected individuals would benefit from Coinbase's "generous severance policy" and would gain access to a talent center with a variety of career resources, including interview training, resume reviews, and networking opportunities.

The changes at Coinbase have put some potential recruits into trouble. At least two people who will be hired by Coinbase said they may lose their OPT (Optional Practical Training) Visa due to the canceled offer.

While others said they received emails reassuring them they would not lose their newly hired job due to a slowdown in company hiring. But they then received an impersonal email informing them of the offer being canceled a few weeks later.

Coinbase is increasing its staff as part of its plan to hire 2,000 employees by 2022, saying it saw “huge future product opportunities for the future of Web3” at the time.

Its most recent earnings report revealed that Coinbase added 1.218 employees in the first quarter of 2022 alone, bringing its total number of employees to 4.948.

"While we did not make this decision lightly, it is a wise decision given market conditions," Brock said in the letter. “We will continue to evaluate all of our options for navigating Coinbase responsibly through the current cycle.”

The Coinbase hiring freeze is indicative of cooler conditions for the cryptocurrency market, and so are layoffs at other companies on the blockchain. Cameron and Tyler Winklevoss, the twins behind cryptocurrency exchange Gemini, also announced that they were cutting 10 percent of their existing staff. The same goes for Rain, a major Middle East-based crypto exchange, which also laid off dozens of employees.

Last week, well-known short-seller Jim Chanos called Coinbase “grossly overvalued” on the Crypto Critics Corner podcast, and predicted its share price would be “in its mid-teens” by the end of this year. Coinbase shares fell 9.7 percent after news of the hiring freeze was published on Friday, June 3.