Going AI-Native: Why Coinbase is Cutting 'Pure Managers'
Coinbase has announced plans to cut 14% of its workforce as part of a broader transformation into what CEO Brian Armstrong calls an AI-native organisation. Around 700 employees will be affected by the reduction.
Brian told staff in an email that AI had "dramatically" changed the pace of work within the company, describing the moment as an "inflection point" requiring fundamental operational changes.
"We are adjusting early and deliberately to rebuild Coinbase to be lean, fast and AI-native," he wrote. "We need to return to the speed and focus of our startup founding, with AI at our core."
According to Q1 2026 data, nearly half of the 80,000 recent tech sector layoffs could be attributed to AI integration efforts.
Organisational structure changes
The company is reducing its hierarchical layers as part of the transformation, with Brian revealing Coinbase will operate with just five layers below him.
Each leader could manage 15 or more direct reports under the new structure. The change aims to create teams that can move quickly and ensure every leader contributes actively to projects
Stating that there will be "no pure managers", Brian argued: "Managers should be like player-coaches, getting their hands dirty alongside their teams."
Other technology firms are implementing similar structural changes. Jack Dorsey, CEO of the fintech firm Block, announced in February that the company would lay off 40% of its workforce.
Speaking on the Long Strange Trip podcast, Jack said Block was reducing middle management layers from five to two or three. He said an ideal structure would have no layers at all.
"In the most ideal case, you know, there is no layer," says Jack. "Everyone in the company reports to me and that would be all 6,000 of the company. And that feels somewhat ridiculous when you consider the old structure, but when you consider that the majority of our work is going through this intelligence layer, it's a lot more manageable."
AI-native workforce development
Coinbase is concentrating resources around what Brian calls AI-native talent. These employees will manage fleets of AI agents as part of their work.
The company is experimenting with reduced pod sizes using AI. Tests include one-person teams that balance engineering, design and product management responsibilities.
Brian has emphasised the importance of AI adoption at Coinbase for several months. He revealed on Stripe Co-founder John Collison's podcast in September that some employees had been fired for not using AI.
Brian says he was told it would take two quarters to reach 50% AI adoption within the company, following which he "went rogue" and posted in the company's Slack channel that all employees needed to onboard with the technology by the end of the week.
Employees who had not used the technology were subsequently asked to attend a Saturday meeting.
"I jumped on this call on Saturday and there were a couple people that had not done it," Brian says. "Some of them had a good reason because they were just getting back from some trip or something and some of them didn't and they got fired."
Brian acknowledges that some people did not like the approach, but believes it provided clarity around how the company needed to lean into AI.
