Inside a Corporate Culture War Stoked by a Crypto C.E.O.

Jesse Powell, founder and chief executive of Kraken, one of the world’s largest cryptocurrency exchanges, recently asked his staff, “If you can identify as race, can you identify as race or ethnicity?”

He also questioned the use of pronouns of his choice and led a debate on “who can refer to another person as the word N”.

And he told workers that questions about women’s intelligence and risk appetite compared to men’s were “not as persistent as one might have initially thought.”

In the process, Mr. Powell, a 41-year-old Bitcoin pioneer, started a culture war between his more than 3,000 workers, according to interviews with five Kraken employees, as well as internal documents, videos and chat logs reviewed by The New York Times. Some workers have openly challenged the chief executive to view their comments as “painful”. Others have accused him of promoting a hateful workplace and harming his mental health. Dozens of people are considering leaving their jobs, employees said, who did not want to speak in public for fear of retaliation.

Corporate culture wars have become abundant during the coronavirus epidemic as remote work, inequality and diversity have become central issues in the workplace. In Meta, which owns Facebook, disgruntled employees have agitated for racial justice. On Netflix, employees protested the company’s support for comedian Dave Chappell, when he aired a special broadcast that was criticized as transphobic.

But rarely has such anger been actively stored by top bosses. And even in the male-dominated cryptocurrency industry, known for its liberal philosophy that promotes freewheeling speech, Mr. Powell has taken that conduct to extremes.

Its boundary pushing comes amid a deep crypto recession. On Tuesday, Coinbase, one of Kraken’s main competitors, said it was laying off 18 percent of its employees after Gemini and Crypto.com cut jobs at two other crypto exchanges. Kraken – valued at $ 11 billion, according to Pitchbook – is also reeling from the turmoil in the crypto market, as the price of Bitcoin has fallen to its lowest level since 2020.

Mr. Powell’s Culture Crusade, played mostly on Kraken’s Slack channels, could be part of a broader effort to oust workers who don’t believe in the same values ​​the crypto industry is stripping, employees said.

This month Mr. Powell unveiled a 31-page culture document outlining Kraken’s commitment to “liberal philosophical values” and “ideas of diversity” and told employees at the meeting that he did not believe they should choose their own pronouns. Documents and recordings of the meeting were obtained by The Times.

Those who disagreed could leave, Mr. Powell said, and choose a program that pays four months’ salary if they make sure they never work in Kraken again. Employees have until June 20 to decide if they want to participate.

On Monday, Kraken executive Christina Yee, looking at the people on the fence, wrote in a slack post that “CEO, company and culture Not at all Will change meaningfully. “

“If someone strongly dislikes or hates working here or thinks the people here are despicable or have a bad character,” she said, “work in a place you don’t dislike.”

The company publicly posted an edited version of its culture document on Tuesday after The Times contacted Kraken about its internal conversations. In a statement, Alex Rapoport, a spokesman, said Kraken did not tolerate “inappropriate discussions”. She added that the company has more than doubled its workforce in recent years, adding that “we felt the time was right to strengthen our mission and our values.”

Mr. Powell and Ms. He did not respond to requests for comment. In Twitter thread In anticipation of this article on Wednesday, Shri. Powell said “about 20 people” were not connected to the Kraken culture and although teams should have more input, they “study more on policy topics.”

“People get excited about everything and can’t follow the basic rules of honest discussion,” he wrote. “Back to the dictatorship.”

The conflict at Kraken highlights the difficulty in translating crypto political ideologies into the modern workplace, said Finn Brunton, a professor of technology studies at the University of California, Davis, who wrote a book in 2019 about the history of digital currency. Many early Bitcoin proponents hated freedom of thought and government intrusion; Recently, some have rejected the politics of identity and called for political purity.

“A lot of big whales and big delegates now – they’re trying to bury that history,” Mr. Said Brent. “Those who are left behind who actually hold it are having more trouble.”

Mr. Powell, who studied at California State University in Sacramento, started an online store called Lute in 2001 that sold virtual amulets and potions to gamers. A decade later, he adopted Bitcoin as an alternative to government-backed money.

In 2011, Mr. Powell worked on the mount. Gox, one of the first crypto exchanges to help the company navigate security issues. (Mt. Gox broke up in 2014.)

Mr. Powell later founded Kraken in 2011 with Thanh Lu, who sits on the company’s board. The start-up operates a crypto exchange where investors can trade digital assets. The Krakનw were headquartered in San Francisco but are now largely remote operations. It has raised funds from investors such as Hummingbird Ventures and Tribe Capital.

As cryptocurrency prices have skyrocketed in recent years, according to industry data tracker, CoinMarketCap, Kraken has become the second largest crypto exchange in the United States behind Coinbase. Mr. Powell said last year that he was considering taking the company publicly.

He also urged some workers to subscribe to the philosophical basis of Bitcoin. “We have this conceptual purity test,” Mr. Powell spoke about the company’s recruitment process on the 2018 crypto podcast. “A test of whether you’re aligned with the vision of Bitcoin and Crypto.”

In 2019, Kraken’s former employees posted abusive comments about the company on Glassdoor, a website where workers write anonymous reviews of their employer.

“Kraken is the perfect metaphor for the ideal of any utopian government,” wrote one reviewer. “Great ideas in theory but in practice they are very controlled, negative and unreliable.”

In response, Kraken’s parent company sued anonymous reviewers and tried to force Glassdoor to reveal their identities. The court ordered Glassdor to change some names.

On the glass door, Mr. Powell has a 96 percent approval rating. The site adds, “This employer has taken legal action against the reviewers.”

Mr. at Kraken. According to messages viewed by The Times, Powell is part of a slack group called Trolling-999 Plus. The group “… and you thought 4chan was full of trolls,” referring to an anonymous online message board known for its hate speech and radicalizing some of the gunmen behind the mass shootings.

In April, a Kraken employee posted a video internally on a separate Slack group that started the latest feud. The video featured two women who said they preferred કરતાં 100 in cash over Bitcoin, which was worth more than $ 40,000 at the time. “But a woman’s brain works this way,” the employee commented.

Mr. Powell came inside. He said the discussion on women’s mental abilities was incoherent. “Most American women have been brainwashed in modern times,” he added on Slack in an exchange seen by The Times.

His comments caused a stir.

One female employee wrote, “It is painful for a person to be brainwashed in this regard or to look for leadership and advocacy to make fun of this situation.”

“It’s not fun to see your gender minds, abilities and preferences being discussed in this way,” wrote another. “It’s incredibly harmful to others and women.”

“Being offended doesn’t hurt,” Mr. Powell replied. “Science, the discussion of biology, the attempt to determine the facts of the world cannot be harmful.”

In a company-wide meeting on June 1, Shri. Powell was discussing Kraken’s global footprint with workers from 70 countries, while he focused on the topic of choice pronouns. It was time for Kraken to “control the language,” he said in a video call.

“It’s not practical to let just 3,000 people customize their pronouns,” he said.

On the same day, he invited employees to join him in a slack channel called “Debate-Pronouns”, where he suggested that people use pronouns not based on their gender identity but on their gender at birth, according to conversations seen by the Times. . He stopped his answers after the thread became controversial.

Mr. Powell resumed the discussion on Slack the next day as to why people could not choose their race or ethnicity. He later said that the conversation was about who could use the word N-, which he noted was not a stigma when used lovingly.

Mr. Powell also aired a culture document entitled “Kraken Culture Expelled”.

“We do not prohibit insults,” read a section. Others said employees should show “tolerance for different thinking” and refrain from labeling comments as “toxic, hateful, racist, ex-phobic, useless, etc.” And “Avoid censoring others.”

He also explained that the company had abandoned the vaccine requirements in the name of “crakenite body autonomy”. The section entitled “Self-Defense” states that “law abiding citizens should be able to equip themselves.”

“You may need to consider these crypto and libertarian values ​​regularly when making work decisions,” he says.

In an edited version of the document publicly posted to Crack, covid vaccination was mentioned and the company’s belief in letting people tie their hands was dropped.

Those who disagreed with the document were encouraged to leave. At the June 1 meeting, Shri. Powell unveiled the “Jet Ski Program”, which the company has labeled as a “re-commitment” to its core values. Anyone who felt uncomfortable had two weeks off for a four-month paycheck.

“If you want to quit Kraken, read a memo about the program,” We wish you were hopping on a jet ski and happily heading for your next adventure! “

Kitty Bennett And Amy Ortiz Contributed to research.

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