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US-based cryptocurrency exchange Coinbase plans to cut 14% of its global workforce as it flattens its management structure and leans heavily into an AI-first strategy.
In an email to employees which was later shared on X, Brian Armstrong, CEO of Coinbase, said the layoffs are partly driven by the crypto downturn.
A crypto downturn is a sustained period of falling prices and reduced trading activity across the cryptocurrency market, which directly impacts revenue for companies like Coinbase that rely on transaction volume.
The other goal is to flatten the organization, enabling faster execution with AI at the core of how teams operate. Armstrong stated that AI is speeding up work dramatically – teams can now build in days what used to take weeks, and even non-engineers are shipping production code.
In response, the company is shifting to a leaner, faster, AI-first approach to regain startup-level speed and focus.
“To get there, we are not just reducing headcount and cutting costs, we’re fundamentally changing how we operate: rebuilding Coinbase as an intelligence, with humans around the edge aligning it,” he added.
Coinbase is the latest company linking layoffs and changes to organizational structures with the rise of AI, following recent cuts announced by Snap, Meta, Block, Amazon, and Oracle.
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From managers to player-coaches
In practice, this means cutting what Armstrong dubs “pure managers,” opting instead for “player-coaches” who oversee team members but are also strong individual contributors.
“Fewer layers, faster decisions: we are flattening our org structure to five layers max below CEO/COO. Layers slow things down and create coordination tax. The future is small, high context teams that can move quickly,” Armstrong added.
“In more top-down structures where decision-making is centralized at the top, having fewer layers of structure does indeed make things move faster,” Hywel Carver, CTO-turned-founder at Skiller Whale, told LeadDev.
Carver said that a core constraint in engineering is the limited amount of context people can effectively hold and reason about. CTOs work across long-term, organization-wide concerns, while developers focus on deep technical decisions within shorter time horizons.
“Use of AI has meant that developers need to cache less awareness in their head about the codebase and CTOs need to cache less awareness about the company, which means everyone in the organization has mental space to hold a broader context than they used to. I think that’s a reason why we may need fewer organizational layers now,” he added.
Rajesh Jethwa, CTO of software engineering consultancy Digiterre, echoed these sentiments. “Armstrong is responding to real pressures, and I agree with the directional instincts: smaller teams, less coordination tax, leaders closer to the work, and more aggressive AI adoption. Fewer organizational layers can absolutely lead to faster decision-making, particularly when layers mainly exist to relay information or dilute accountability,” he explained.
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Coinbase goes AI-native
Coinbase is also planning to leverage its most AI savvy employees by creating “AI-native pods,” which could even include one-person teams directing agents that encompass the responsibilities of engineers, designers, and product managers.
“AI is bringing a profound shift in how companies operate, and we’re reshaping Coinbase to lead in this new era. This is a new way of working, and we need to leverage AI across every facet of our jobs,” Armstrong said.
