Crypto and Payments Company Faces 'Layoff Wave' Due to AI, Market Questions True Motive

May 6th Several crypto and payment firms have announced large-scale layoffs under the guise of embracing artificial intelligence, drawing widespread skepticism from investors and analysts over "AI washing." Since Block cut 50% of its staff in February, companies including Gemini, Coinbase and PayPal have followed suit. Coinbase CEO Brian Armstrong said, "The biggest risk right now is inaction," as the firm proactively reorganizes to build a "lean, fast, AI-native" organization. PayPal aims to save $1.5 billion over two to three years via AI transformation and will lay off 20% of its workforce. 0G Labs— which develops blockchain systems for AI agents—also cut 25% of its employees in late April. Market observers note Bitcoin has fallen roughly a third from its October 2023 peak, with low trading volumes, intensified payment industry competition and firms grappling with unique challenges (e.g., Block’s overhiring during the boom and PayPal’s new CEO pushing transformation). It’s thus hard to tell if the layoffs are truly aimed at boosting AI efficiency or obscuring underlying business struggles. Stock performance post-layoff news has been mixed: Block is up ~38% since its announcement; PayPal dropped 12% at one point Tuesday; Coinbase fell nearly 4% intraday.