Coinbase layoffs show banks still offer subpar severance
Nobody’s safe from the swathes of cuts in crypto, not even those who’ve cut already. Despite making over 1100 employees redundant in the summer of 2022, publicly traded crypto titan Coinbase has once more made dramatic layoffs as it cuts costs.
In a message today, Coinbase CEO Brian Armstrong said the company is cutting 20% of its workforce, encompassing 950 people. It's a reminder that crypto jobs are no more secure in 2023 than in 2022, even if you work for one of the industry leaders.
However, with banks like Goldman Sachs, Nomura, Credit Suisse and Morgan Stanley also cutting jobs, Coinbase's latest layoffs are another reminder that the severance on offer in banks sucks.
Coinbase's severance is pretty generous
Today's Coinbase layoffs don't seem to have gone entirely smoothly. Various posts on Blind suggest that the layoffs were mentioned yesterday in an internal Slack channel which somehow became external (Coinbase isn't commenting) and according to one Coinbase employee, staff were locked out of their computers with no access to internal tools as phone and email notifications confirmed their departures.
The trauma of being laid off is, however, partly compensated by the favorable terms. In today's message, Armstrong promised the 950 exiting staff, “ a minimum of 14 weeks base pay (2 additional weeks per year worked), health insurance, and other benefits.” Coinbase will also offer “extra transition support” for employees with work visas or based outside the US.
This compares pretty well to banks. Credit Suisse for example, has cut its severance pay from three weeks per year of service, down to two, with no minimum cushion. And Deutsche Bank (which averaged the largest severance package of any bank in London in 2014), now pays the statutory minimum to its UK bankers with no severance at all to voluntary leavers.
Tech companies on the other hand offer far more lucrative terms. Meta’s recent cuts received 16 weeks pay plus an additional 2 years for every year worked. Amazon’s cuts in November offered three months pay, health insurance and a weekly stipend for 12 weeks. The latter offer was also presented to employees that wished to voluntarily leave during the layoffs.
Is crypto really a bigger career risk?
Coinbase's generosity suggests that while crypto jobs are still precarious, getting cut in crypto has upsides. Banks may seem the safer option, but they are just as likely to make cuts across the year and their severance may not nearly be as kind.
Tech, while slightly better in pay, is also unloading a great number of staff and, depending on where you worked, finding another role coming off a position there may be more difficult than you’d think.
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