Oct 1, 2020 - Economy

Behind the scenes of the Coinbase controversy

Illustration of two George Washington faces cut out of quarters with happy and sad faces like drama masks.

Illustration: Aïda Amer/Axios

In June, a group of Coinbase employees walked out after CEO Brian Armstrong did not immediately commit to making a public statement in support of Black Lives Matter.

Why it matters: The crypto "unicorn" is now offering severance packages to employees who no longer feel aligned with the company’s apolitical culture and mission, which Armstrong clarified Sunday in a blog post.

  • Armstrong wrote that Coinbase will not engage in political activism beyond issues that directly impact the company, and that employees shouldn't engage in political discussions at work.
  • Sunday’s post drew a range of responses. Some praised Armstrong for his approach, while others viewed it as thinly-veiled tolerance for bigotry.

What happened: The June 4 walkout followed an "ask me anything" session between Armstrong and company employees, which took place in the wake of George Floyd's murder.

  • One source says Armstrong argued making a public statement in support of BLM would be divisive. However, another source says the question was specific to the BLM organization and its policy positions, rather than broader anti-racism sentiment. The company declined to comment when asked by Axios.
  • Shortly after, employees convened online to discuss the meeting, and several senior managers encouraged co-workers to partake in a virtual walkout that day.
  • A number of employees took part, though the exact number is unclear.
  • Later in the day, Armstrong posted a series of Twitter messages in support of BLM.
  • The next day, he sent emails to employees apologizing for his handling of the topic during the meeting and assuring them of the company's commitment to an inclusive workplace (including specific actions). Company executives later held a meeting with its internal group for employees of color.

It's worth noting that, several days prior to the meeting, Armstrong had sent a company-wide email acknowledging how "many of you are hurting, and that we, as Coinbase leadership, are here to support you.”

Since then: Employees have been told to keep political discussion out of company-wide communication channels, and initial comments pushing back on the blog post were removed from Slack allegedly for that reason, per a source.

  • The proposed severance packages, also reported by other outlets, includes four to six months of pay, six months of COBRA coverage, and a seven-year window to exercise stock options.
  • Employees have until Oct. 7 to make a decision and a company meeting is scheduled for today to address questions.

What they’re saying: “It's clear internally that this is all about the BLM walkout,” one current employee tells Axios.

  • Other sources, however, suggest this is part of Armstrong's longstanding discomfort with politics in the workplace, exacerbated by the upcoming election.
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