Bitcoin just rallied but Coinbase employees are still being let go

Coinbase employees are still being let go despite Bitcoin rallying.

 

Being an employee in the tech industry became a whole lot worse this past week after Coinbase said it will be reducing its headcount by nearly 20 per cent.

Coinbase CEO (and Lex Luthor look-alike) Brian Armstrong told employees last week that the world’s second-largest cryptocurrency exchange needed to let go of about 950 people in a bid to save costs in light of prevailing macroeconomic conditions.

Some of these conditions included the spectacular downfall of rival FTX, which the CEO did not explicitly name. However, he did acknowledge an exacerbated downward trend in the crypto market.

Coinbase had previously let go of 1,100 people in June last year in an attempt to become leaner, and the latest cuts are meant to do the same. “Accountability rests with me as the CEO”, Armstrong wrote in a memo to employees, adding that “in hindsight, we could have cut further at that time”.

While things look bad at Coinbase, they’re not any better at Binance. An investigative report from Forbes indicates that investors are withdrawing a lot more assets from the world’s largest cryptocurrency exchange than its CEO Changpeng “CZ” Zhao is letting on.

According to the report, Binance has already kissed goodbye to about $12 billion in assets in less than 60 days, and if this trend continues, investor withdrawals could hit critical mass – spelling trouble for the company which was busy celebrating wins in Sweden and Bahrain last week.

CZ is often cited as a central character in the downfall of FTX due to his rivalry with former FTX CEO Sam Bankman-Fried aka SBF, who seemed to agree with that characterisation in a wide-ranging “pre-mortem” overview published recently.

Of the three main reasons for the downfall of his company, he said one was “an extreme, quick, targeted crash precipitated by the CEO of Binance” that ultimately resulted in users trying to withdraw their assets – only to find that they couldn’t because the company simply did not have the funds to pay them out (despite previous assurances that that was not the case).

In the same blog post, SBF said he “didn’t steal funds, and I certainly didn’t stash billions away” and noted that despite everything, “very substantial recovery remains potentially available”.

The latter bit is corroborated by the fact that attorneys overseeing the bankruptcy proceedings of FTX say they have recovered more than $5 billion in liquid assets and plan to raise more money by selling the company’s nonstrategic investments that were valued at $4.6 billion.

With so much going on, Binance saw an increase in trending interest, landing on the #55 spot on HackerNoon’s Tech Company Rankings. Coinbase meanwhile was ranking #81.

Hodl Gang

While cryptocurrency exchanges were battling their demons, an unlikely sight was occurring in crypto markets: a rally in the price of Bitcoin. In what must be music to the ears of the “hodl” gang, Bitcoin passed the $20k barrier for the first time in over two months.

So overjoyed was Miss El Salvador by this news that she decided to dress up in a suit inspired by the OG cryptocurrency in the ongoing Miss Universe beauty pageant (lol). Jokes aside, the real reason why she dressed up as the female version of Bitcoin was to celebrate El Salvador’s decision to become the world’s first country in adopting the cryptocurrency as legal tender over two years ago, Reuters reported.

At this point, it’s anyone’s guess whether Bitcoin will continue going up and reach the crazy peaks it hit in 2021 before crashing spectacularly in 2022, but, here’s to hoping!

Musk Cracks the Rubik’s Cube of Business

Elon Musk, now the world’s second richest man, has cracked the code for earning business during bad times: offer sh*t for free or for less. And that’s exactly what two of his companies were busy doing this past week.

According to The Wall Street Journal, Twitter, which experienced one new low after another following its sale to Musk, has offered to match ad spend by up to $250k if brands decide to use the social media titan’s platform to get the word out.

The move effectively gives brands free advertising and could be a godsend for some teams given that marketing and sales budgets are the first to go during a recession.

Meanwhile, Musk’s other company, Tesla, has decided to cut the price of its vehicles by 20 per cent to prevent competitors from clawing away at its market share. While the move is likely to boost demand, consumers who recently bought a Tesla vehicle are understandably unhappy, calling the discounts a “punch in the gut”.

In Other News..

  • Goldman Sachs let go of 3,000 of its employees in a cost-cutting measure. Meanwhile, Blackrock, another behemoth of the financial sector, has decided to let go of 500 individuals.
  • You no longer need Xzibit to Pimp Your Ride for the privilege to play video games in your car. Sony will now do that for you. The company is partnering with Honda to release its own spin on an electric vehicle (calling it the Afeela) which will let you play Playstation video games.
  • Ubisoft, the publisher behind titles such as Assassin’s Creed, painted a bleak picture for its future and has decided to cancel three unannounced projects as part of an overall restructuring.
  • Jobs are safe from AI, or are they? A new report indicates that CNET has been publishing AI-written articles for months, though the rise of the “robot reporter” goes far beyond the one being reported at CNET as evidenced by this New York Times article from 2019.

And that’s a wrap! There’s still time for you to tell us about your 2022 and gain some internet cred, and if you’re one of the thousands impacted by the ongoing layoff decisions in the tech industry, you may want to share your story.

See y’all next week. PEACE! ☮️

— Sheharyar Khan, Editor, Business Tech @ HackerNoon

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