Coinbase, a major cryptocurrency exchange in the US, is laying off around 700 employees, which represents about 14% of its workforce. The company says this restructuring is due to a downturn in the crypto market and a growing focus on using artificial intelligence to improve its operations.
The cuts are expected to be largely completed by the end of the second quarter of 2026.
US employees will receive at least 16 weeks of their regular pay. For every year they’ve worked, they’ll get an extra two weeks of pay as well.
In addition, departing employees will retain their currently vested equity and receive six months of continued health coverage through COBRA. Those working under visas will also receive extra help with their transition.
A Market Downturn Meets A Technology Shift
Coinbase CEO Brian Armstrong announced the layoffs in a post on X, explaining they were happening because of two conflicting factors.
One is a pullback in crypto trading that has squeezed the company’s revenue.
This is an email I sent earlier today to all employees at Coinbase:
Team,
Today, I made the tough call to reduce Coinbase’s workforce by about 14%. I want to explain the reasons behind this decision, what it means for the people who are leaving, and how it sets us up for the future.
— Brian Armstrong (@brian_armstrong) May 5, 2026
Armstrong believes that artificial intelligence is significantly speeding up work for small engineering teams at Coinbase, to the point where the company is reconsidering its staffing needs.
Armstrong noted that our company’s performance continues to fluctuate each quarter. He emphasized the need to streamline costs now so we can emerge stronger when the economy improves.
Coinbase is testing a new approach where individual employees will be responsible for all aspects of a project – from engineering and design to product development – working as a single-person team.
The company is reportedly reducing management positions and focusing its workforce on developing artificial intelligence expertise.
The company anticipates costs of $50 to $60 million for the restructuring, primarily due to employee severance and related benefits. These costs are expected to be recorded in the financial results for the second quarter of 2026.
Markets React Positively Despite The Job Cuts
Investors reacted positively to the announcement, with Coinbase stock rising over 4% in trading before the market officially opened on Tuesday.
This change follows an unexpected loss in the last quarter, which was caused by fewer people trading cryptocurrencies.
Even so, Armstrong remained positive, predicting that cryptocurrency is poised for a new surge in popularity, but emphasized that his company needs to reduce its expenses first.
As of May 1, 2026, a regulatory filing revealed that around 700 employees will be affected.
Coinbase operates as the largest crypto exchange in the US.
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2026-05-05 16:45