Crypto firms cite AI as reason for large layoffs

Several major crypto companies have presented artificial intelligence as a central reason for recent staff cuts, saying AI enables flatter management and smaller teams to handle more work.

Coinbase announced cuts of about 700 roles. CEO Brian Armstrong wrote in an internal memo posted on X that “AI is bringing a profound shift in how companies operate” and urged managers to act like “player-coaches.” A Securities and Exchange Commission filing said the restructuring could incur up to $60 million in severance and termination expenses.

Coinbase reported a first-quarter net loss of $1.49 per share on $1.41 billion in revenue. Transaction revenue declined as trading volumes fell, with bitcoin down about 21% in the quarter. Company executives and outside analysts attributed results to lower market activity.

Block reduced headcount by about 4,000 employees in February, bringing its workforce to under 6,000. Crypto.com cut roughly 180 roles. Kraken trimmed about 15% of staff in late 2024 and described those reductions as removing layers of management; that prior announcement did not invoke AI.

Job trackers recorded more than 81,000 layoffs in the global tech industry in the first quarter of 2026. An outplacement firm reported 83,387 announced U.S. job cuts in April, up 30% from March. The firm identified AI as the top stated reason for cuts in April for a second consecutive month, while market conditions accounted for a larger share year to date.

Owen Lau of Clear Street noted Coinbase is signaling to investors that management is actively managing costs to deliver positive adjusted EBITDA through the cycle.

At a recent conference, Scale AI CEO Jason Droege argued that companies sometimes present AI as the reason for layoffs while the underlying cause is routine rightsizing, observing: “A lot of the layoffs that are happening right now because of AI, if you really dig in, it’s sort of like washing the layoffs.”

Company leaders framed the reductions as proactive restructuring rather than responses to cash shortfalls, and said the firms remain well capitalized while reshaping operations to speed decision-making and reduce managerial layers.