“There could still be further contagion,” warned Coinbase CEO and Co-Founder, Brian Armstrong in a blog announcing the job cuts.

In a blog post this morning, Coinbase (NASDAQ: COIN) CEO and Co-Founder Brian Armstrong said he still expected further contagion from the crypto market’s downturn, but the events represented an opportunity for the company and validated its long-term strategy. He said the company had to be operationally efficient enough to take advantage and therefore needed to reduce operating expense by about 25% quarter-on-quarter, which included letting go of about 950 people. (Coinbase)

Armstrong clarified that he would shut down several projects which had “a lower probability of success” to reduce headcount.

“Our other projects will continue to operate as normal, just with fewer people on the team,” he said.

To soften the blow, he added:

“To those of you who will be leaving, please know that this is not a reflection of your work or contributions to Coinbase. I believe we have an incredible team, and all of you have been important members of that. Instead, it’s a reflection of the current economic climate and crypto market.”

In possibly veiled references to FTX Armstrong remarked:

• “I believe recent events will ultimately end up benefiting Coinbase greatly (a large competitor failing, emerging regulatory clarity, etc.).”
• “Dark times also weed out bad companies, as we’re seeing right now.

The  Coinbase stock is trading at $39.71 at the time of writing, up 3.76% for the day. It has lost nearly 83% of its value over the past 1 year.

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