Vice confidently fails to understand financial industry in piece on crypto
June 14, 2022
Vice, or the Motherboard part of Vice, seems not to really understand which industry crypto is a part of. This matters for the standard terms and conditions of employment can and do differ wildly across sectors. Even, the social expectations of how layoffs will occur.
Motherboard’s complaint is about Coinbase. We can all see the turmoil in that cryptocurrency market. We’re not hugely surprised that a company which was recently going to expand massively has now reversed course and is firing folk. But this shows that Vice doesn’t really understand the business Coinbase is actually in:
….lay off 1,100 employees—or roughly 18 percent of the company’s workforce—in order to withstand the economic turmoil affecting the cryptocurrency markets and broader tech industry.
But in his note, first shared internally, Armstrong said that affected employees would receive news of the layoff in their personal email inbox, as the company had already “cut access to Coinbase systems for affected employees” to avoid leaks.
If we think of Coinbase as being in the computing market then that does sound harsh. “Leaks” are a pretty feeble reason too – a few people gossiping is going to do how much harm?
However, if we think of the business that Coinbase is actually in – the financial markets – then this is normal. That’s how people with access to the internal or external trading systems at banks or funds get treated. A call into the office, the statement that you’re fired, the security guard meets you with a garbage bag containing your desk contents as you leave. You are not even allowed back into the trading room, let alone to log onto any systems. Absolutely all and any system access is barred immediately.
The reason is that “leaks” when the individuals have access to trading tools for tens and hundreds of millions of dollars are serious things. So, they’re not allowed to happen. Termination in financial markets is immediate and total.
This only looks odd to us if we forget what business Coinbase is in. It’s all about code and computers ‘n’ stuff but it’s really financial markets. So, the culture is like that of financial markets.
Vice is a significant media outlet these days. The cable channel reaches 60 million American homes, and the magazine has a 900,000 distribution. The website gets 27 million visits a month. This has an influence on our society.
Vice’s real error in this is here: “While the tech industry has struggled to adjust to the new economic climate, cryptocurrency companies have been hit particularly hard “ Crypto companies aren’t in the tech space, they’re in financial markets. Understanding that would be the first step to grasping how and why they act like they do. Coinbase needs to be judged by the standards of Wall Street, not Silicon Valley.