Coinbase (NASDAQ:COIN) today highlighted the ways in which a bearish crypto market is impacting companies in the digital asset space. It announced plans to further extend its hiring freeze and rescind job offers. One element of this is receiving particular scrutiny: A leaked email suggests the company lied to prospective employees about their job security.
Coinbase is one of the largest crypto exchanges in the U.S. It offers over 170 coins and tokens on its platform, and it processes billions of dollars in transactions each day. It’s also the only crypto exchange trading on a mainstream stock exchange.
Unfortunately for Coinbase, the market has been in disarray for much of the year. Investors are getting spooked out of the market as a result of the volatility, which in turn is hurting companies that rely on high transaction volumes. Coinbase’s first-quarter earnings report shows that transaction revenue was down 56% from Q4.
The market downturn is causing Coinbase, as well as other companies like Gemini, to start cutting down on costs. In Coinbase’s case, it is freezing all new hires. But a series of leaked emails show that the company was not truthful to its prospective employees in the lead-up to a series of rescissions.
Coinbase Under Fire Thanks to Leaked Emails
InvestorPlace received the leaked emails from Blind, a platform dedicated to employee leaks. An email sent the week of Coinbase’s first hiring freeze announcement promises that the company would not be rescinding any offers. “We are still extremely excited about having you join Coinbase and we will not be rescinding the offers of any employees who have already signed or have received an offer from us,” the email reads.
It continues by reminding these hires of the company’s healthy balance sheet — in Q1, Coinbase reported $6.1 billion in cash and equivalents.
News today shows that Coinbase is walking back on this assurance. The company is now rescinding its job offers in order to cut costs, citing market conditions. SFGATE reported that additional leaked emails appear to offer incoming employees some sort of severance package as well as access to a talent hub to help find different jobs.
COIN stock closed down nearly 10% on the news.
On the date of publication, Brenden Rearick did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
