Crypto Markets Today: Coinbase Announces More Job Cuts Amid Market Jitters
ALSO: Both bitcoin and ether reached nearly four-week highs. Equities closed higher.
Crypto exchange Coinbase (COIN) said it’s planning to reduce headcount by around 950 employees as part of a restructuring that it expects to be complete by the end of the second quarter.
This article originally appeared in Crypto Markets Today, CoinDesk’s daily newsletter diving into what happened in today's crypto markets. Subscribe to get it in your inbox every day.
- This figure would amount to around 20% of Coinbase's workforce, which sits at about 4,700 according to the company's website.
- In a U.S. Securities and Exchange Commission filing on Tuesday, Coinbase said it is responding to "ongoing market conditions impacting the crypto economy."
- The company expects the restructuring to cost $149 million to $163 million, including $58 million to $68 million in cash charges related to employee severance.
- Coinbase began shedding jobs in June when crypto's bear market started to take hold. CEO Brian Armstrong said at the time that the company had "grown too quickly" during the crypto bull market, expanding to more than 5,000 employees from 1,250 at the start of 2021. The firm began by cutting 1,100 jobs, equivalent to 18% of its workforce at the time, followed by another 60 in November as the crypto winter grew even colder with the collapse of rival exchange FTX.
- Analysts on Wall Street reacted positively to Coinbase's job cuts announcement on Tuesday. “We are encouraged by this morning's news, as it shows the company is taking financial discipline seriously in a very challenging crypto/macro environment,” analysts from Barclay’s wrote, while acknowledging that it could also be a sign that the company is preparing for a tough year ahead.
Bitcoin (BTC): The largest cryptocurrency by market value recently climbed 1.7% at the $17,400 level. BTC was trading as high as $17,488 over the past 24 hours, hitting a nearly four-week high. Large traders, often called "whales," however, are staying on the sidelines of the bitcoin market due to low bitcoin market liquidity. Equities closed up as traders processed Federal Reserve Governor Michelle Bowman’s Tuesday comment on expecting more interest rate increases to bring down inflation. The tech-heavy Nasdaq Composite closed up 1.0%, while the S&P 500 and Dow Jones Industrial Average (DJIA) were up 0.7% and 0.5%, respectively.
Ether (ETH): The second-largest cryptocurrency recently traded up 1.5% to $1,340. Ether’s recent price jump also pushed the asset to a nearly four-week high.
Binance-peg BUSD stablecoin: Binance acknowledged that its Binance-peg BUSD stablecoin hasn't always been backed fully with reserves, but said it's now fixed the problem, according to a report from Bloomberg. The token was at times undercollateralized in 2020 and 2021, Bloomberg reported, citing an analysis by Jonathan Reiter of blockchain analytics company ChainArgos.
Crypto Market Analysis: Early Signs of Higher Volatility May Be Creeping Into Bitcoin, Ether
By Glenn Williams Jr.
The knee-jerk reaction to an upper-limit breach is often optimistic. Viewing any indicator in isolation is risky at best and reckless at worst.
A look back at when BTC breached an upper limit on Dec 13 shows a 2% decline in prices 14 days later. ETH’s prior breach on Oct. 29, saw prices down a whopping 22% after 14 days.
Bullish investors will note that prices are entering a range of prior low activity. These “low volume nodes” generally represent areas where prices move quickly, in search of the next area of price agreement.
For bitcoin, that area currently exists 9% higher, near the $19,000 range. For ether, the next high-volume node area is approximately 16% higher, near $1,590.
- Listen 🎧: Today’s "CoinDesk Markets Daily" podcast discusses the latest market movements and a closer look at the co-conspirators who may have been involved in the FTX saga.
The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups. As part of their compensation, certain CoinDesk employees, including editorial employees, may receive exposure to DCG equity in the form of stock appreciation rights, which vest over a multi-year period. CoinDesk journalists are not allowed to purchase stock outright in DCG.
Learn more about Consensus 2023, CoinDesk’s longest-running and most influential event that brings together all sides of crypto, blockchain and Web3. Head to consensus.coindesk.com to register and buy your pass now.