Per The Verge
Coinbase CEO Brian Armstrong Says FTX Collapse Results in a Black Eye for the Industry, Citing Possible More Contagion Out There
1/11/2023
While the fall of FTX already affected major crypto exchanges and companies, Coinbase's CEO said that there is a possibility that other contagions could be out there. The CEO, Brian Armstrong, said that the crypto exchange's collapse resulted in the crypto industry getting a black eye.
Armstrong: "The FTX collapse and the resulting contagion has created a black eye for the industry, and there is likely more contagion out there."
Some of the affected crypto firms that filed for bankruptcy include BlockFi, Three Arrows Capital, Voyager Digital, and Celsius Network. Although another crypto firm, Kraken, did not file for bankruptcy, it decided to stop operations in Japan by the end of January.
A few months after the collapse of FTX, Coinbase decided to let go of about 20% of its staff, meaning around 950 people could lose their jobs. These job cuts are part of the company's plans to reduce its quarter-over-quarter operating expenses by 25%.
The news comes after the company's first round of layoffs which let go of 18% of its staff. Per CNBC, Coinbase let go of 1,100 employees in June of last year.
Per Coinbase's blog, it announced that as they examined their 2023 scenarios, they definitely need to reduce their expenses for them to continue. Further details regarding the company's expense outlook are expected to be released in their Q4 earnings call.
Armstrong: “While it is always painful to part ways with our fellow colleagues, there was no way to reduce our expenses significantly enough, without considering changes to headcount,”
As Coinbase is trying to thin out its expenses, news on the FTX bankruptcy revealed that SBF would frequently spend $2,500 on lunch for himself and his staff, spending around $40 million on hotels, food, and travel in nine months.
See flow at unusualwhales.com/flow.
Other News:
- US-Based Kraken to Stop Japan Operations Deregistering on Jan 31
- Filing Reveals FTX Spent $7M on Food in 9 Months: $40M Spent In Total for Hotels, Foods, and Travel
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