U.S. bitcoin exchange Coinbase will cut its staff by about 18% due to the onset of crypto winter. Co-founder and CEO Brian Armstrong called it a “difficult decision. Armstrong noted that the company has more than quadrupled its staff in the past 18 months. Too rapid a growth has led to problems coordinating and integrating new team members, making the team less effective. Affected employees will be notified by personal messages. They will immediately be denied access to confidential customer information. Employees who leave Coinbase will be compensated at 14 weeks’ salary with bonuses for more than one year of service. Coinbase will also pay a four-month health insurance policy and provide assistance with future employment, including at portfolio companies in the venture capital division. According to CNBC, Coinbase has about 5,000 full-time employees. The layoffs will affect about 1,100 of them.
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June 13 trading session on stock exchanges in the U.S. opened with a significant drop in shares of cryptocurrency-oriented companies. Over the past 24 hours, bitcoin has lost 13.3%, according to CoinGecko. The price of digital gold dipped below $24,000, with the asset trading near $23,740 as of this writing. At the open, shares of analytics software provider MicroStrategy were down 25.24%, Coinbase down 13.5%, and Silvergate Capital down 14%. According to Bitcoin Treasuries, MicroStrategy’s 129,218 BTC is now worth just over $3 billion. Earlier, the head of the company Michael Saylor reiterated his commitment to the first cryptocurrency.
Marathon Digital shares were down 12.33%;
Riot Blockchain, down 10.46%;
Core Scientific, down 12.45%;
Bitfarms, down 9.43%;
Bit Digital, up 8.8%;
Argo Blockchain, up 16.64%;
Hut 8 Mining and Hive Blockchain lost 10% and 9.6%, respectively.
Futures on the Nasdaq 100 fell 2.54% and the S&P 500 fell 2.5%.
Coinbase is launching a program for direct deposit of paychecks into cryptocurrencies. PayPal and Robinhood already offer this service in the US.
Coinbase will soon allow U.S. companies to deposit their employees’ paychecks directly into accounts at the crypto exchange. In a blog post Monday, Coinbase Senior Director of Product Prakash Hariramani announced the option. This will allow employees to use their paychecks to purchase cryptocurrencies without transaction fees. For their part, companies can set up direct deposits through a supported payroll company in the Coinbase app or through a company’s human resources department.
Coinbase, the largest U.S. trading platform for cryptocurrencies such as Bitcoin or Ethereum, is already highly prized by investors even before its debut on New York’s Nasdaq. This year, the company’s shares changed hands for an average of $343.58 in over-the-counter trading, Coinbase disclosed in a filing with the U.S. Securities and Exchange Commission (SEC) on Wednesday. That puts the California-based group’s latest valuation at least $67.6 billion (56.8 billion euros), it said.
Coinbase is benefiting greatly from the enormous cryptocurrency hype ahead of its IPO, which is expected later this month. Last year, the over-the-counter average price for the company’s shares was just $28.83.
Most recently, according to U.S. media reports, even a total valuation of more than 100 billion U.S. dollars was considered a good possibility for the IPO since private transactions usually achieve much lower prices than after the premiere on the public capital market.
Coinbase plans to list 114.9 million shares on Nasdaq, according to a filing with the SEC. However, this is not a traditional IPO but a direct placement without investment banks’ assistance and a prior pricing process.
Coinbase said it made about $1.3 billion in revenue in 2020, more than double the previous year. The bottom line was a profit of 322 million US dollars, after a minus of 30 million in the previous year.
San Francisco-based leading crypto exchange, Coinbase Pro, has added support for Cardano (ADA). Coinbase announced the news through a blog post on March 16, noting that it has begun accepting incoming transfers from ADA to Coinbase Pro. The company went on to say that ADA trading is scheduled to begin on March 18 at 4:00 PM UTC, provided the coin receives sufficient liquidity.
According to the blog post, users can trade ADA for four pairs using the Coinbase Pro platform. These are ADA/USD, ADA/BTC, ADA/EUR, and ADA/GBP. However, the coin must first accumulate ample supply on the platform. Like other Coinbase listings, ADA trading will go live after three stages. These are post-only, limit-only, and full trading.
The publication added that if any of the above order books fail the exchange’s assessment of a properly functioning market, it will remain in the same stage for an extended period of time. Coinbase added that it could suspend trading on the order book altogether, based on its trading rules.