17 May Coinbase Slows Hiring Efforts Amid Market Concerns and Disappointing Q1 Numbers
In recent years, Coinbase has made a reputation as the bread-and-butter of crypto trading platforms – commanding a higher price for its services in exchange for institutional investment opportunities, a user-friendly, easy-to-use platform, and so on.
However, no number of big-league investments can insulate a company from the industry it belongs to – and with crypto investors currently navigating rather choppy waters, it appears that Coinbase is following suit.
A Slump In Trading Volume Equals a Decline in Revenue
While trading platforms such as Binance or Kraken rely more heavily on staking and other ways of garnering revenue to turn a profit, Coinbase is notorious for betting on transaction fees to keep their business rolling.
The downside of this model is that when times get tough, HODLers tend to double down – while many day traders become increasingly wary of market conditions, content to wait for better opportunities.
As a result, the predominantly bearish market of Q1 2022 led to a disappointing quarterly report and an all-time low of COIN, Coinbase’s publicly traded stock.
Coinbase Prioritizes Consolidation Over Expansion
Overall, Coinbase remains in good shape. Despite ominous wording in the recent 10-Q disclosure filing, Brian Armstrong – the CEO of Coinbase – stated that the company is nowhere near bankruptcy, and assured investors their funds remained secure. Although the exchange seems perfectly capable of weathering the current storm, it had to put certain planned moves on hold.
In a recent memo, Emilie Choi, the President and COO of Coinbase, revealed temporary changes in the firm’s hiring policy and growth projections.
After emphasizing the importance perpetual expansion still holds for the company, Choi went on to say that Coinbase will be slowing down its hiring efforts for the time being.
Despite plans made in 2021 to triple the size of the company, the current situation has led Coinbase leadership to allocate resources meant for its expansion to “higher-priority business goals.”
Coming Back Stronger
The memo ends on a more positive note, stressing the importance of quality onboarding for new hires. It also promises a spectacular return to form in short order, as proven by Coinbase leadership’s glowing track record during the past 10 years at the helm.
“Big picture: We know this is a confusing time and that market downturns can feel scary. […]. We plan for all market scenarios, and now we are starting to put some of those plans into practice. We’re in a strong position — we have a solid balance sheet and we’ve been through several market downturns before, and we’ve emerged stronger every time.”
With a robust team of industry leaders already on board, Coinbase looks well on track to make a speedy recovery once the dust settles.
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