Good times don’t last, and even Coinbase, one of the hottest names in crypto, is dealing with the harsh realities of doing business by freezing new hiring. The company will also rescind offers already received by hopeful hires.
The chief people officer of Coinbase, L J Brock, released a memo announcing that Coinbase would pause hiring indefinitely and even withdraw employment offers that had already been accepted. We feel sorry for the prospective employees that already turned in their resignation letters at their current place of work.
Brock cited current market conditions and ongoing business prioritization efforts as the reason for the action. He wrote, “After assessing our business priorities, current headcount, and open roles, we have decided to pause hiring for as long as this macro environment requires.
“The extended hiring pause will include backfills, except for roles that are necessary to meet the high standards we set for security and compliance, or to support other mission-critical work. We will always prioritize the safety and security of our customers’ funds.
“We will rescind a number of accepted offers.
“We will also rescind a number of outstanding offers for people who have not started yet. This is not a decision we make lightly, but is necessary to ensure we are only growing in the highest-priority areas.
“Limited exceptions apply and will be managed by the same criteria as backfills.”
The first reason is undeniable; the crypto market has been on a downward trend, even pulling down stablecoins that were supposed to be immune to such changes. However, Coinbase has been slowing down its recruitment drive since last month to better position the company to cope with the downward trend. Apparently, that was not enough to save the company’s finances, making Coinbase go the whole hog.
The freeze will also affect backfills or staff brought in to replace workers who left, although security and compliance roles are exempted.
One of the issues Coinbase is facing is the less than enthusiastic welcome its new NFT marketplace got. Launched to the greater audience in May, the social selling and buying place for NFT has struggled to take off. The Motley Fool reported that during the first 19 days of the marketplace, only 4,132 people bought assets, with total sales amounting to $875,000 or just $46,000 per day. This is not in line with the wide reach of Coinbase. The NFT market, in general, is experiencing a decline, which does not help Coinbase’s case. Around the time the company launched its own marketplace, the whole market recorded about 19,000 sales per day, far from the 225,000 transactions in September.
Meanwhile, it is not clear how many offers Coinbase will retract, but Brock promised that affected applicants would get compensation, which he described as generous. They will also be offered access to a talent hub to take advantage of career-boosting resources, including interview coaching materials, resume reviewing services, and networking opportunities.
However, for the individual applicants, the price may be high. For instance, two of those who had signed up for Coinbase could lose their Optional Practical Training Visa. Others complained that Coinbase sent them an email reassuring them that their offers were intact, only to receive another notification of the offer withdrawal weeks later.
Coinbase expanded its workforce by 2,000 last year while predicting enormous product opportunities for the future of Web3.
Other crypto companies are passing through the same issues, including Gemini, slashing staff strength by 10 percent. Another crypto exchange, Rain, has disengaged dozens of employees.