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Further waves of reckoning swept through the cryptocurrency industry Tuesday, with exchange company Coinbase Global Inc. saying it would cut almost a fifth of its staff and crypto lender Celsius Network LLC hiring a law firm to examine restructuring options.
Coinbase, one of the signal growth companies of the crypto boom, said it was slashing its workforce by 1,100 employees, or about 18% of its staff, because the company had grown too quickly and a potential recession “could lead to another crypto winter.”
In a letter to employees, Chief Executive Brian Armstrong said “our employee costs are too high to effectively manage this uncertain market.”
“We appear to be entering a recession after a 10+ year economic boom,” Mr. Armstrong wrote. “A recession could lead to another crypto winter, and could last for an extended period. In past crypto winters, trading revenue (our largest revenue source) has declined significantly.”
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Meanwhile, Celsius, one of the largest crypto lenders, tapped attorneys from law firm Akin Gump Strauss Hauer & Feld LLP to advise on solutions for its mounting financial problems, people familiar with the matter said. Celsius had told users on Sunday night that it was pausing all withdrawals, swaps and transfers between accounts because of extreme...
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