The New York Times published a critique of Coinbase's lackluster internal policies, citing several former employees who complained of "racist or discriminatory" treatment.
Coinbase uncovered the NYT scandal article shortly before publication
Journalist Nathaniel Popper's report, released on Friday, is based on comments from 23 current and former Coinbase employees. He paints a picture of a company that "has long struggled with managing black employees."
Coinbase, which uncovered the story's developments during a fact-check, attempted to preempt itself on Wednesday evening. The company e-mailed a statement to its employees and then posted it in an official Twitter post, warning the public of a possible "bad story" on the way.
“Since this story can be read by your friends, family and professional contacts, we wanted to give everyone a warning and provide important context,” the statement read. Specifically, Coinbase expressed its belief that the NYT report "likely will cite" three former Coinbase employees and a former contractor. But the company underestimated the scale of the scandal.
Racial stereotypes and discrimination in hiring and promoting black employees
The NYT report details several incidents of alleged discriminatory behavior, ranging from racial stereotypes to inappropriate practices regarding the hiring and promotion of black employees.
The Times reports that at least 11 former employees have contacted the human resources department or their managers regarding these incidents. The crypto sector, like the tech industry in general, has already been criticized before for lack of diversity.
Robert Greenfield, CEO of Emerging Impact, wrote in his media article: "The crypto community is suitably selective about which aspects of society it wants to change." "Most people of color working in technology know that there is a diversity problem," a former Coinbase employee, Alysa Butler, said in the Popper article.
Kim Milosevich, a spokesperson for Coinbase, told the New York Times that the company "does not tolerate racism, gender or other forms of discrimination." He added that: "All allegations of discrimination are treated very seriously, investigated by both internal and third parties and appropriate action is taken."
Coinbase, an 8 billion dollar exchange, made headlines in September after CEO Brian Armstrong published an open letter declaring Coinbase an "apolitical" and "mission driven" company, with the knowledge that justice issues social should not be discussed in company hours or channels.
Days later, the company offered a layoff package for all employees who were uncomfortable with Armstrong's mission statement. As of October 14, 5% of Coinbase employees had left the company. Coinbase is one of the largest public exchanges by volume of business and as popular as it is Bitcoin Revolution. The company is reportedly exploring a public offering of shares in 2021.
