Coinbase’s landmark stock listing has made billionaire CEO Brian Armstrong an instant icon of the cryptocurrency revolution — but his last major turn in the spotlight came from a dustup over the Black Lives Matter movement.
While the crypto exchange’s 38-year-old co-founder reportedly keeps a low profile by avoiding the press and public conferences, he became embroiled in controversy last fall when he told Coinbase employees not to talk politics at work.
The edict was intentionally out of step with other Silicon Valley giants that issued statements in support of Black Lives Matter and pledged to support racial justice as protests raged across the country last summer.
Outlining the policy in a Sept. 27 blog post, Armstrong said he wanted to avoid “internal strife” that has hurt worker productivity at Facebook and Google, where staffers have long aired social and political concerns in internal chatrooms, and occasionally taken to the streets to protest.
“It has become common for Silicon Valley companies to engage in a wide variety of social activism, even those unrelated to what the company does,” Armstrong wrote. “While I think these efforts are well intentioned, they have the potential to destroy a lot of value at most companies, both by being a distraction, and by creating internal division.”
The post sparked a backlash from critics such as Twitter co-founder Jack Dorsey, who said Bitcoin is a kind of “direct activism against an unverifiable and exclusionary financial system” and that sidestepping politics “leaves behind people.” Dick Costolo, Twitter’s former CEO, leveled more pointed barbs at Armstrong, branding his position an “abdication of leadership.”
“Me-first capitalists who think you can separate society from business are going to be the first people lined up against the wall and shot in the revolution,” Costolo wrote in an incendiary tweet that likewise got blasted by critics.
Armstrong’s blog post also reportedly drew fire internally from Coinbase employees.
“Why stay and put effort into this work if it’s just tokenized into recruiting points and not actually improving the sense of belonging and psychological safety,” Lauren Lee, a staffer responsible for diversity inclusion who has since resigned, wrote in a Slack message obtained by The New York Times.
Amid the hubbub, Armstrong — whose fortune ballooned to more than $12 billion after Coinbase went public Wednesday — offered severance packages to anyone who disagreed with his stance and wanted to leave. Some 60 people, or about 5 percent of the staff, took Coinbase up on the offer, he revealed in an Oct. 8 follow-up post.
“It was reassuring to see that people from under-represented groups at Coinbase have not taken the exit package in numbers disproportionate to the overall population,” Armstrong wrote.
Political tensions had reportedly been simmering inside Coinbase for months before Armstrong’s initial post. Several employees staged a virtual walkout on June 4 after Armstrong said in a meeting that issuing a statement in support of Black Lives Matter would be divisive, according to Axios.
Armstrong later apologized for how he handled the issue and pledged to update the company’s diversity plan, reports said. He also reportedly backed the Black Lives Matter movement in a series of tweets — but they appear to have been deleted.
“I’ve decided to speak up,” Armstrong said in the now-deleted tweetstorm. “It’s a shame that this even needs to be said in this day and age, but racism, police brutality, and unequal justice are unequivocally wrong, and we need to all work to eliminate them from society.”
But Armstrong stood by his decisions to avoid politics this week as he took Coinbase public in a watershed moment for the crypto industry, telling The Wall Street Journal that it was one of his most important actions last year.
“There are a lot of other problems in the world, and we can all probably at Coinbase acknowledge those problems, but we don’t always agree on what the actual solution is to those problems,” he told CNBC in a Wednesday interview.
“My point of view is that companies today with great intentions can sometimes end up creating division and kind of actually unwelcoming environments internally by engaging in some of these issues.”