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Coinbase shares pop 12% on company’s plans to slash workforce

Singapore has granted Coinbase regulatory permission to offer cryptocurrency services within the island nation. This is an enormous win for Coinbase because it continues to expand internationally despite continued pressure on the crypto market.

Jakub Porzycki | Nurphoto | Getty’s paintings

Actions Coin base closed down 12% on Tuesday after the cryptocurrency exchange announced it will lay off 20% of its workforce.

The company, which reported hiring around 4,700 staff in September, said it will cut around 950 jobs. Coinbase cut 18% of its workforce in June throughout the collapse of stock and cryptocurrency prices.

In early 2022, Coinbase he said it was planned so as to add 2,000 jobs in product, engineering and design. CEO Brian Armstrong said he’s now trying to alter the culture at Coinbase to “return to the start-up roots” of smaller teams that may move fast.

“In retrospect, looking back, we must always have done more,” Armstrong said in a telephone interview with CNBC. “The best you may do is to react quickly when information becomes available, and that is what we’re doing on this case.”

Coinbase is the newest tech company to put off staff after a hiring spree throughout the Covid pandemic. On Wednesday, Amazon said it will cut 18,000 jobs, greater than initially estimated in 2022, and Salesforce said it had cut jobs by greater than 7,000, or 10%. Elon Musk has laid off about half of Twitter’s workforce after taking the helm as CEO in October, and Meta has cut greater than 11,000 jobs, or 13%. Cryptocurrency firms Genesis, Gemini and Kraken also cut jobs.

Coinbase’s stock spike on Tuesday prolonged a rally from Monday, when stocks soared after JMP analysts said they believed the corporate had the potential to prosper in the long run.

Analysts maintained their improved stock rankings and said they continued to be enthusiastic about “real-world innovations” happening within the crypto industry. Analysts said that after the spectacular collapse of cryptocurrency exchange FTX in November, they consider that the decline set the industry back significantly, perhaps by years.

However, analysts said the crypto asset class stays in its infancy and believes that “declaring a victory for either side at this early stage is unwise.”

“While that is clearly a period of stress for the industry, we consider that the strongest firms (including Coinbase) will survive and even thrive in the long run,” they wrote in a Monday memo.

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