Coinbase announces layoffs of 700 people, citing AI as a productivity booster

Crypto World News reports that Coinbase CEO Brian Armstrong announced on May 5th that the company will lay off approximately 700 employees, about 14% of its total workforce. Armstrong directly attributed the layoffs to AI technology changing engineering economics, stating that this technology enables small teams to achieve output that previously required larger manpower. Following the announcement, Coinbase’s stock price rose, and investors generally viewed it as a signal of profit improvement. The company expects to record restructuring costs of $50 million to $60 million. Armstrong’s statement has made Coinbase one of the increasingly many large tech companies using AI productivity as a reason for layoffs. Coinbase is also continuing to push for the passage of the “Clear Act,” with lobbying expenditures in Washington reaching $1.07 million in the first quarter, and reversing its early opposition to the bill after a compromise on stablecoin profits.