Binance slashes employee benefits, analysts accuse it of fraudulent practices
One of the world's largest cryptocurrency exchanges, Binance, has been accused of fraudulent behavior by a cryptocurrency analyst following its decision to cut employee benefits and lay off staff. Adam Cochran took to Twitter to publicly accuse Binance of lacking reasonable explanations for its actions and mishandling employee issues. Cochran highlighted the lack of transparency surrounding Binance's decision to cut benefits and lay off staff, and called into question the company's motives, suggesting that Binance's actions were not solely to reduce costs.
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Cochran pointed out that Binance carried out the layoffs without notice and froze internal hiring, while publicly claiming to be hiring new employees. He also shared a screenshot of an internal email that showed Binance suddenly cutting employee benefits, citing the need to reduce expenses because of tough times. However, Cochran questioned Binance's explanation as this occurred during a rising market trend and on the day of one of the year's largest Bitcoin price surges.
Furthermore, Cochran noted that Binance's laid-off employees had salaries below the US average. Compared to other major cryptocurrency exchanges such as Coinbase, Binance's revenue was significantly higher, leading Cochran to question the lack of reasonable explanations for Binance's cost-cutting measures. Cochran estimated Binance's annual revenue to be between $10 billion to $12 billion based on public API data, primarily through its native cryptocurrency payment method, BNB. However, he questioned where this revenue was allocated, as it did not seem to be used for employee salaries, stock buybacks, or human resources plans.
In addition, Cochran pointed out that some items in Binance's employee benefit plan had relatively low costs, such as "mobile subsidies." Even if all employees used this subsidy to buy a new iPhone every year, the total expense would only be about $8 million, which is still a small portion of Binance's total revenue.
This incident has also sparked discussions about how Binance treats its employees. Cochran pointed out that Binance's employees are not allowed to publicly disclose their employment at the company, creating a secretive work environment. However, they can discuss company issues through internal channels, leading to speculation about the reasons behind the company's behavior. There have been reports in the past of low employee happiness scores at Binance, with some former employees saying, "the company is full of secrets, and it's the same internally, like being a spy."
Some Twitter users defended Binance's actions, stating that cost-cutting, layoffs, and closing businesses in some countries can be seen as wise business decisions. However, this incident will undoubtedly have an impact on Binance's reputation, especially in the cryptocurrency community where discussions about transparency and employee rights are becoming increasingly heated.
