Coinbase and its CEO Brian Armstrong entered this year with ambitious plans. After earning a net profit of more than $800 million in the final quarter of 2021, the company—the largest cryptocurrency exchange in the United States—set out on an “extensive global expansion strategy.” It seemed as if crypto was taking over the world, and Coinbase was a key player, making waves when it ran a Super Bowl ad featuring a QR code bouncing around the screen, which proved so successful that it crashed the Coinbase app.
As part of the strategy, the company undertook an ambitious hiring push in order to triple the size of its staff by the end of the year, roping in people from some of the most successful technology companies and financial institutions in the world with what one hire described to Motherboard as “fucking absurd” amounts of compensation. One by one, people at Facebook, Amazon, Netflix, Tesla, Google, Apple, Goldman Sachs, JPMorgan Chase, and other powerful companies bet their futures on the future of crypto—or at least on Coinbase.
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And then it all fell apart. From the outset of the year, the broader cryptocurrency industry struggled to combat the flurry of news that was sinking tokens and share prices alike, and Coinbase wasted little time reversing course. Armstrong, an eccentric CEO who deplores political talk at work, made the decision to stop all hiring. This included people who had already accepted offers and were preparing to join the company in the coming days, weeks, and months.
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The company said it had pulled “a number of accepted offers,” understating the true scope of the decision. In total, more than 300 people were suddenly left scrambling. The news blindsided the would-be hires, not least because many of them had received numerous reassurances that their offers would not be rescinded, according to interviews with 17 people who had job offers rescinded. (Motherboard granted the hires anonymity because they feared Coinbase revoking their severance packages and damaging their future job prospects.)
The decision felt rushed to those who had lost their jobs, who were told by those who had recruited them that they had received no forewarning about the decision either. Panicked, some begged for their old jobs back. Some, like those who had been offered jobs last year as college undergraduates and had stopped their job searches out of respect for their future employee, had no obvious options. Some worried about the leases they had just signed. And others worried they would have to leave the country if they couldn’t find a new job before their visa expired.
One person called the way Coinbase handled the decision “reckless and negligent,” and another described it as “irresponsible.”
Another put it even more bluntly: “This whole thing just kind of fucks me.”
In response to a request for comment, a spokesperson for Coinbase said the company had “nothing to share” beyond the company’s past public statements.
The reasons that people had agreed to join Coinbase varied. One person appreciated the CEO’s desire for a lack of political conversation at work. Another described himself as a “Coinbase super user” going back years. Some liked the fact that they could work remotely, or thought Coinbase seemed more steady than the typical crypto company, allowing them a safer way into a high-risk, high-reward industry.
But most people had joined for the money. One hire said he had been offered more than $300,000—double what he was making at his current company, and an amount he described as “life-changing money.” He felt he couldn’t turn it down. “We just live in this fun capitalist hellscape where you kind of have to say yes,” he said.
Another person who was planning to work for Coinbase’s back-end team said the money had proven so alluring that he had signed on despite his own misgivings about the cryptocurrency industry. When he told his friends in software engineering and computer science that he had taken the job, they joked that he would soon start scamming those around him.
“They kind of made fun of me,” he said. (Others told Motherboard that while they weren’t anti-crypto, it wasn’t their passion. “I don’t really know anything about crypto,” admitted one software engineer. “I don’t care either way,” said another.)
In recent months, the situation shifted dramatically and quickly as tech stocks and cryptocurrencies both plummeted, and the crypto sector suddenly found itself dealing in crisis. Gemini, a crypto exchange owned by the Winklevoss brothers, announced it would lay off 10 percent of its staff to survive the “crypto winter,” and The blockchain protocol Terra’s ecosystem collapsed after its “algorithmic” stablecoin depegged from the U.S. dollar, wiping out billions of dollars and prompting a SEC investigation.
The situation hurt Coinbase as much as almost any entity. In mid-May, Coinbase revealed it had lost more than $400 million in the first quarter, due in part to decreased trading volume, and the company’s share price dropped down near $50 after starting the year around $250.
In response, Coinbase executives undertook a series of dramatic actions. Armstrong, who had previously made it a point “not to discuss short term stock price fluctuations,” wrote to Coinbase’s employees on May 11 to say that while recent market news was “scary,” Coinbase’s balance sheet was strong and the company had “tremendous” amounts of money—$6 billion in cash “and equivalents” to be exact, as of its most recent shareholder letter. On May 16, Coinbase took a further step when it announced that it would “slow hiring and reassess our headcount needs against our highest-priority business goals.” Once again, the company said it was still in a “strong position” with a “solid balance sheet.”
Some of the hires felt reassured. But a number got nervous and asked their contacts at Coinbase if they had anything to worry about.
Eight hires told Motherboard they had received reassurances in some form that signed offers would be honored—some the day they signed the offers, and others as recently as two days before their offers were rescinded. “Every time I reached out to everyone, they said everything was fine,” said one such person. “I had a conversation with my recruiter who told me not to worry,” said another. Another incoming hire, concerned by Coinbase’s dropping share price, said he reached out to ask about severance packages, in case offers were rescinded, and was told a contingency plan wasn’t in Coinbase’s playbook.
In late May, the company also sent emails to a number of hires telling them in no uncertain terms that the hiring freeze would not affect them, explaining that “this does not impact the offers of any employees who have already signed.” The line was bolded in various versions of the email reviewed by Motherboard. On June 2, though, only days after many people received written reassurance that they would be hired, Coinbase Chief People Officer L.J. Brock revealed internally and on the company blog that the company had decided to rescind the offers as part of a broader “hiring pause” at the company that would last for the “foreseeable future.”
“All incoming hires will be advised of their updated offer status today by email,” Brock wrote.
Coinbase then started to email individual hires with messages that didn’t vary much outside of the hire’s name and the amount of severance offered, which ranged from one to three months of pay among people who spoke with Motherboard. In the email, Brock said revoking the offers was a “very difficult” but “necessary” decision. (One guy’s summary: “Hello. Today, we shared an announcement. Regret to inform you: go fuck yourself. We’re giving you two month’s salary. Goodbye.”)
The news crushed the hires, who described themselves as shocked, disappointed, and in disbelief. One person described the feeling of reading the email as comparable to a breakup.
“My heart dropped,” said another person who had already quit their job and cried after reading the email. “It was just shocking.”
One software engineer said the news caught him off guard. He hadn’t seen the public blog post before he received the email, so when he originally saw the subject (“Update to your Coinbase offer”), he assumed it was another step in the onboarding process or maybe even news of a salary bump. Before he had begun to process that he had lost a job he had never even started, people started to reach out, which frustrated him.
“I don’t know why they would announce it to the rest of the world before I even knew,” he said.
Not everyone who should have received the email originally did. “I thought, ‘Hey, maybe I’m in the clear,’” one such person said. The next day, a Coinbase employee contacted the hire asking if he had any questions regarding his job being rescinded. After he informed the person that he had not received any such email, he received a separate email from the “Coinbase People Team” that included the email he was supposed to have already received and informing him that he no longer had a job. “Apologies that this email did not deliver properly as originally intended. Please see the original email below and, if they haven’t already, a senior member of our Talent team will be reaching out for a 1:1,” the company wrote.
The recruiters and hiring managers who had assured the hires in the prior weeks that their jobs were safe seemed to be panicked, too. Three hires in different divisions said their recruiters told them they had learned the offers would be rescinded that day. One described the recruiters as “blindsided,” a second described them as “frazzled,” and the third said a third said his recruiter told him it was an “absolute shock.” A number of hires felt bad for the recruiting team.
“I honestly don’t think the recruiting team had any idea,” said a fourth hire.
The news left the hires in horrible situations. Some had already quit their jobs in preparation to start at Coinbase and were preparing to start as soon as the following week. One person who had been reassured that their job was safe said that by the time Coinbase rescinded the offer, her current employer had filled her role; she is now without a job. Another person who had also told their boss about the Coinbase job was able to claw their job back, but said it tarnished their relationship. “We’re not best friends at the moment,” he said.
One incoming Coinbase software engineer said he had opened his company computer and was trying to complete the onboarding process the day his offer got rescinded.
Another said he had declined a job at a prominent tech company hours before Coinbase rescinded the email. “I was honestly confused more than anything—confused at the recruiter offering me to sign a contract literally … days before they were going to reject it,” he said of Coinbase. He then frantically emailed the recruiter at the other company.
In preparation for their new jobs, a number of people had already put down a significant amount of money on new apartments—Coinbase is a “remote-first” workplace, it should be noted—and to ship their belongings.
“The severance package will definitely be extremely helpful in paying off some of that,” said one recent graduate who leased a San Francisco apartment.
Ashutosh Ukey had been choosing between a job as a backend software engineer at Coinbase and starting a doctoral program in computer science at the University of Illinois Urbana-Champaign, one of three Ph.D. programs he had received offers to join. He had considered a number of other roles in the technology industry as well, but stopped looking elsewhere after accepting the Coinbase role.
When the offer was rescinded, he felt panicked. Ukey, who is from India, had been counting on the job to allow him to stay in the United States, and he now finds himself on the clock to find a new job before his visa runs out later this year. “If I’m unemployed for more than those allowed days, my visa would no longer be valid. And I wouldn’t be allowed to stay here in the U.S.” he told Motherboard. “I would have to go back to India.”
Ukey wrote about his situation on LinkedIn, where the post received more than 12,000 likes. Days later, Brock, the chief people officer, acknowledged in a series of tweets last week that the company had put hires with work-related visas in “particularly difficult” situations and said Coinbase would provide such people with legal services.
College students were left in a frustrated place as well. Many engineers had agreed to join Coinbase as far back as last year during an aggressive recruiting process, and turned down opportunities with other top companies out of respect to the company. “In November, I could only see upside,” said one of them. “I didn’t want to accept the Coinbase offer and keep looking elsewhere. I wanted to be ethically responsible in not lying to them.” They were now left without jobs at the worst possible time. One person had graduated the week his offer was rescinded.
There have been signs of frustrations from inside Coinbase too, where some employees reportedly were “circulating” a since-deleted anonymous petition purportedly written by a Coinbase employee arguing that “the executive team has recently been making decisions that are not in the best interests of the Company, its employees, and its shareholders,” which listed the aggressive expansion plans and rescinded offers among the complaints.
Armstrong lashed out in response to the post through Twitter on Friday, calling the post “really dumb,” in part because “if you get caught you will be fired,” and “unethical because it harms your fellow co-workers, along with shareholders and customers.” (“Quit and find a company to work at that you believe in!” he added.)
To help those affected by the company’s decision, Coinbase established a “talent hub” to help them find new jobs, which included “job placement support, resume review, interview coaching and access to our strong industry connections.” As part of that effort, the company created a website that listed the contact information of more than 300 people whose offers had been rescinded with the aim of helping them find their “next great role.”
“We aim to help create a career-defining moment for these folks — just not the one we had originally intended to,” Brock wrote in a post about the website.
A few people who spoke to Motherboard said they understood Coinbase’s decision considering the broader economic climate and would consider working there if the opportunity ever presented itself again. “We have no duty to Coinbase. They have no duty to us,” said one such person. Many more people, however, said the way it was handled has forever changed their opinion on the company.
“I think they’re gonna have a hard time getting any talent in the door in the future, if they do survive this,” one person said, reflecting the feelings of many of the hires.
Amid the turbulence within the broader crypto space, most of the hires who spoke to Motherboard said they would also steer clear of jobs in the industry more broadly. “I’m not gonna look for any crypto jobs,” said one software engineer. Another said as the country sits on the brink of a potential recession, he’s now searching for security over anything else. “Inherently as a concept, crypto would be the least secure industry that I could pick,” he said.
After her offer had been rescinded, one hire reflected on what she had thought about crypto before the Coinbase offer. She had never been willing to invest much of her own money in the crypto space, which she saw as too volatile for her risk tolerance. And here, tempted by an unbelievable paycheck, she had put that concern aside.
“Shame on me for taking the leap with Coinbase,” she said. The lesson, in her eyes? “If it sounds too good to be true, it is.”
