After publicly announcing plans to slow hiring, tough market conditions have pushed crypto exchange Coinbase to look for ways to slash spending, according to emails obtained by The Information.
Coinbase has felt the fallout of recent market conditions, incurring a net loss of $430 million in its first-quarter earnings and a plummet in its stock, $COIN. That led the firm to announce that it was reevaluating its previous plan to triple the size of the company and instead slow hiring at the moment.
According to internal emails, the extent of that reevaluation appears to be considerably more than just slowing hiring. The Information reported that the emails contain plans to freeze hiring for two weeks and cut spending on cloud services and gas fees among other cost-cutting measures.
The plan is code-named Plutus, according to The Information, and is detailed in an email from Coinbase Chief Product Officer Surojit Chatterjee. Plutus is the Greek god of wealth, and Chatterjee laid out a plan to capture such wealth by focusing on driving more revenue in "highest-impact" products.
That includes focusing on retail trading, staking and institutional trading and custody by adding tokens and expanding custody and international expansion for retail traders and its prime brokerage service. The firm also plans to focus on its Coinbase One subscription service, which charges a recurring fee rather than individual trade fees.
In addition to increasing the revenue flowing in, Plutus plans to reduce the money flowing out by cutting costs on cloud services and gas fees. The Information reported that the details of these plans were not detailed in the emails it obtained, but Engineering Vice Presidents Sumanth Sukumar and Will Robinson will lead the efforts on minimizing software costs and gas fees.
The emails obtained by The Information also included a message from People Officer L.J. Brock. Hiring will be on hold for at least two weeks, though already-extended offers and scheduled interviews will be honored. And though it's not looking to expand the headcount at the moment, it's looking to maintain it.
Brock's message included a commitment to grant extra stock to employees scheduled to vest in Q2 to make up for the recent decline in $COIN.
When reached for comment, a spokesperson directed The Block to tweets posted Thursday by Surojit Chatterjee, the firm's chief product officer. In the thread, Chatterjee wrote that "we will be doubling down on high impact products" including "our core retail and institutional trading products, as well as staking."
"This does not mean we plan to stop investing in strategic and venture projects. We believe the down market is a great time to build for the longer term," Chatterjee wrote in the thread. "We’re working on foundational web3 efforts and many of which I announced in the recent Permissionless conference."
At the time of publication, $COIN is trading at $67.42, gaining slight ground from the post Q1 earnings drop to $61.70.