Wide-scale layoffs at Coinbase Global Inc. won’t significantly impact its compliance team, as the cryptocurrency exchange remains under a New York regulator’s watch after recently settling allegations it violated anti-money-laundering laws.
Coinbase wants to cut operating expenses by 25% and plans to lay off about 950 people, Chief Executive Brian Armstrong said Tuesday. A spokeswoman for the company, asked whether the departures would impact the exchange’s risk, compliance or legal teams, said there won’t be “meaningful” layoffs in key roles.
“We aren’t making meaningful cuts for roles that are necessary to meet the high standards we set for security and compliance, or to support our mission-critical work,” she said.
She declined to give specifics on whether any workers in those departments would lose their jobs. The company as of the end of September had about 4,700 employees.
Regulators have scrutinized the crypto industry since the collapse in November of exchange FTX. Coinbase, along with Binance and OKX, is among the largest cryptocurrency exchanges, according to industry watcher CoinGecko.
Coinbase has entered into a settlement with the New York Department of Financial Services, agreeing to pay a $50 million penalty after the regulator accused it of violating anti-money-laundering laws by failing to conduct sufficient background checks. The settlement was made public last week.
The exchange in the settlement agreed to spend another $50 million to improve its compliance program over the next two years.
NYDFS said it had installed an independent monitor at Coinbase, a relatively rare move, in 2022 to help work on outstanding issues. The monitor will continue working with the exchange for another year.
NYDFS said Coinbase had made remedial efforts. Paul Grewal, the company’s chief legal officer, said after the settlement that the exchange “remains committed to being a leader and role model in the crypto space, including partnering with regulators when it comes to compliance.”
A spokeswoman for NYDFS didn’t respond to a request for comment on the layoffs.