The bloat was especially severe on Coinbase’s customer service team. New staff members often feel they don’t have enough to do. “I get four calls a day,” said David Visini, a fired customer service employee. “It’s dead, dead, dead.”
Ms. Choi, the chief operating officer, acknowledged that Coinbase had been “overhired” during the pandemic and said it was difficult to integrate new recruits in a remote environment.
“I don’t know if we have the right tools to set it up to be successful,” he said.
The crypto market crashed in May, sending Coinbase’s stock price down by about 60 percent. In the first quarter, Coinbase’s revenue dropped 27 percent from the previous year, to $1.17 billion, even as expenses more than doubled, to $1.72 billion.
The competition looks better. Sam Bankman-Fried, chief executive of FTX, said in an email that the financial results were “in the same ballpark” as last year, when the company recorded a profit of about $350 million. Binance, the world’s largest exchange, declined to disclose revenue figures. But in June, the company’s founder and chief executive, Changpeng Zhao, declare if they hire 2,000 open positions.
That month, Coinbase employees circulated a petition demanding the dismissal of several top executives. Mr. Armstrong responded aggressively Twitter, called on disgruntled employees to quit. But at a staff meeting, he and other executives struck a more conciliatory note, saying employees should keep their faith in crypto, and that the company would emerge stronger from the turmoil, according to two people involved.
A few days later, the company laid off 1,100 employees.