Coinbase, facing declining revenues, is putting a pause on new business projects, a report from The Information said Thursday (May 19).
It will also be freezing hiring for two weeks and looking at cutting cloud spending on Amazon Web Services along with other savings, according to anonymous reports.
The company’s stock has gone down over 75% in the last six months, especially spurred by the collapse of the UST stablecoin.
The company has also told its employees it’s giving them more stock grants to offset the half of the difference between the grants it made earlier in the year and the stock’s closing price last week.
The exchange was the third biggest in global trading volume after international rivals Binance and FTX.
But because of the trouble with UST, which has affected all crypto in the past few weeks, the company had to burn over $800 million in cash from operations. The company announced after that that it would be focusing on “highest priority” business only for the rest of the year.
The company now is facing the same crisis as others whose stock soared during the early part of the pandemic, but have been in flux since — it has to look at cutting costs while also retaining employees, the report noted.
PYMNTS wrote that the UST collapse had erased $45 billion in value, adding to what has been an extremely dire mood for the currencies.
This will likely see many regulators saying “I told you so” about the stablecoins in particular, which, due to the dollar peg, were supposed to be the most stable kind of digital coin.
One crypto that might be coming out well is USD Coin, though, which is the “most transparent” of the big stablecoins. USD Coin has been trading a little above peg, unlike other such coins.