Many of the tech sector’s most prominent companies have laid off chunks of their staff in recent weeks. Specifically, names like Meta Platforms (NASDAQ:META) and Snap (NYSE:SNAP) have implemented large-scale job cuts as the bear market continues to rage. Now Coinbase (NASDAQ:COIN) is joining the pack. The Coinbase layoffs account for more than 60 staff members.
While this is a smaller number than many other companies, it isn’t the first round of layoffs the crypto exchange has conducted in 2022. In June, Coinbase announced that it would be reducing its workforce by 18%, amounting to roughly 1,100 staff members. After a very difficult trading year, the Coinbase layoffs in 2022 aren’t doing much to restore investor confidence in COIN stock.
Here’s what investors should know about the situation.
What Investors Need to Know About the Coinbase Layoffs 2022
The fact that Coinbase is laying off more workers is unsurprising. And although 60 staff members may seem like a small number, it’s important to pay attention to the details. Those who were let go were primarily part of two departments, recruiting and institutional onboarding. That suggests the Coinbase layoffs may not be over just yet.
It’s no secret that companies in the crypto space have been struggling lately. The recent downfall of prominent exchange FTX has cast a shadow over the entire industry. That negativity won’t be easy to shake. And any scenario in which crypto traders aren’t as active as usual is bad news for companies like Coinbase. What’s more, as InvestorPlace’s Brenden Rearick reports, investors will continue to suffer if the sector doesn’t see more regulation soon.
Does COIN stock have a chance to rebound in the near future? Not likely. Decrypt calls the layoffs “a development that barely moves the needle during a week that’s overflowing with bad news for the crypto sector.” Even as markets rebound in the face of falling inflation statistics, the future looks bleak for Coinbase.
On the date of publication, Samuel O’Brient did not hold (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.