Coinbase slashes 14 per cent of workforce in bid to become 'AI-native'

Coinbase has announced the reduction of approximately 700 employees, representing roughly 14 per cent of its total workforce. The decision, detailed in a blog post by CEO Brian Armstrong, marks a significant restructuring effort aimed at making the organisation leaner and faster as it navigates a downturn in the cryptocurrency market.

Armstrong attributed the cuts to a combination of external market pressures and an internal strategic pivot to become an 'AI-native' entity. He noted that while the company remains well-capitalised with diversified revenue streams, the current environment necessitates a leaner structure to weather the storm and prepare for future growth. The exchange is eliminating management layers and reorganising the business around talent capable of managing fleets of AI agents to drive outsized impact.

A central component of this new operational model involves experimenting with significantly reduced team sizes. Armstrong described plans to implement 'one person teams' where engineers, designers, and product managers consolidate into single roles. This approach aims to restore the speed and focus of the company's startup founding days, with AI placed at the core of its operations.

The rationale for the cuts extends beyond simple cost-cutting; Armstrong highlighted observed efficiencies where AI tools allow engineers to ship projects in days that previously took weeks. He further noted that non-technical teams within the company are now shipping production code, while many workflows are being automated. Armstrong argued that the biggest risk facing every company today is failing to take action during this inflection point.

This move aligns Coinbase with a broader trend in the technology sector, where major firms are citing AI-driven efficiencies to justify workforce reductions. Meta recently announced cuts of 8,000 jobs, while Amazon laid off 14,000 people last October. Armstrong acknowledged that while AI efficiency is a key factor, the immediate catalyst for the restructuring is the downturn in crypto markets.

Affected employees in the United States will receive severance packages comprising 16 weeks of base pay, plus two weeks of pay for each year of tenure. The packages also include the value of the next equity vesting and six months of COBRA health coverage. Armstrong confirmed that workers laid off outside the US will receive a similar package, ensuring a consistent approach to the restructuring across the organisation.