As part of a Corporate Culture War driven by a crypto CEO

Jesse Powell, the founder and CEO of Kraken, one of the world’s largest cryptocurrency exchanges, recently asked his staff: “If you identify as a sex, do you identify as a race or ethnic group?”

He also questioned the use of preferred pronouns and led the discussion “who can cite another person as an N word.”

And he told staff that questions about women’s intelligence and risk appetite compared to men “were not as well-established as one might initially think.”

In the process, Mr. Powell, a 41-year-old Bitcoin pioneer, sparked a culture war with more than 3,000 of his employees, according to interviews with five Kraken employees, as well as internal documents, videos and chat records analyzed by The New York Times. Some staff have clearly questioned the CEO, saying his comments are “painful”. Others have accused him of promoting hateful workplace and harming his mental health. Employees have said they are considering leaving dozens, not wanting to speak publicly for fear of revenge.

The pandemic of the coronavirus has multiplied the wars of corporate culture as remote work has become a major issue in the workplace of inequality and diversity. At Meta, which owns Facebook, stagnant employees have discussed racial justice. On Netflix, employees complained about the company’s support for comedian Dave Chappelle after he was given a special critique of being transphobic.

But there has seldom been such a seriousness in actively supplying the principal. And in the male-dominated cryptocurrency industry, which is known for its libertarian philosophy that promotes free speech, Mr. Powell has taken that ethos to the extreme.

Its impetus comes amid a deeper decline in cryptography. On Tuesday, Coinbas, one of Kraken’s main competitors, said it was laying off 18 percent of its employees on Gemini and, two other crypto exchanges, following job cuts. Kraken – valued at $ 11 billion according to the PitchBook – is facing turmoil in the crypto market, as the price of Bitcoin has dropped to its lowest point since 2020.

Sir. Powell’s culture crusade, largely played on Kraken’s Slack channels, could be part of a wide-ranging effort to expel employees who don’t believe in the same values ​​of the cryptography industry, staff said.

This month, Mr. Powell presented a 31-page cultural paper explaining Kraken’s “libertarian philosophical values” and commitment to “diversity of thought,” and told staff at a meeting that he did not think they should choose their pronouns. The document and the recording of the meeting were obtained by The Times.

Those who disagreed could leave, Mr. Powell said he was committed to a program that would provide a four-month salary if they were confirmed to never work for Kraken. Employees have until June 20 to decide if they want to participate.

On Monday, Christina Yee, a Kraken executive, gave a boost to those on the fence, writing in a Slack post: “They are CEO, business and culture. no it will change significantly. ”

“If someone likes or dislikes working here or thinks they are hateful or poor in nature,” he said, “work in a place that doesn’t disgust you.”

After the Times contacted Kraken about its internal talks, the company publicly released an edited version of its culture document on Tuesday. In a statement, spokesman Alex Rapoport said Kraken does not support “inappropriate discussions.” He added that as the company has more than doubled its workforce in recent years, “we thought it was time to strengthen our mission and our values.”

Sir. Powell and Ms. Ye did not respond to requests for comment. in Twitter thread In anticipation of this article on Wednesday, Mr. Powell said “about 20 people” did not agree with Kraken’s culture and that although the group should have made more contributions, “policy issues were much more studied.”

“People are affected by everything and can’t adapt to the basic rules of honest discussion,” he wrote. “Back to the dictatorship.”

The Kraken conflict shows the difficulty of translating the political ideology of cryptography into a modern workplace, said Finn Brunton, a professor of technology at Davis University in California, who wrote a book on the history of digital currency in 2019. Many early proponents of Bitcoin defended the freedom of ideas and despised government intrusion; recently, some have rejected identity politics and called for political correctness.

“Now a big whale and a lot of big representatives – they’re trying to bury that story,” he said. said Brunton. “People who are really holding on to it feel more struggling.”

Sir. Powell, in California State University, Sacramento, founded an online store called Lewt in 2001 that sold players amulets and virtual potions. A decade later, it took Bitcoin as an alternative to government-backed money.

In 2011, Mr. Powell worked in the mountains. Gox, one of the first crypto exchanges, helps the company navigate a security issue. (Mt. Gox fell in 2014.)

Sir. Powell founded Kraken later in 2011 with Thanh Luu, who sits on the company’s board. Startup operates a cryptocurrency exchange where investors can trade digital assets. Kraken was headquartered in San Francisco, but is now a remote operation. It has raised funds from investors like Hummingbird Ventures and Tribe Capital.

As the price of cryptocurrency has risen in recent years, Kraken has become the second largest cryptocurrency exchange in the United States after Coinbase CoinMarketCap, according to an industry data tracker. Sir. Powell said last year he planned to take out the public company.

He also stressed that some employees subscribe to the philosophical foundations of Bitcoin. “We have this test of ideological purity,” Mr. Powell said about the company’s hiring process in a 2018 crypto podcast. “Test to see if you agree with the approach of Bitcoin and crypto.”

In 2019, former Kraken employees posted harsh comments about the company on Glassdoor, a website where employees write anonymous opinions from their employers.

“Kraken is the perfect allegory for any ideal utopian government,” one critic wrote. “Great ideas are very controlling, negative and distrustful in theory but in practice.”

In response, Kraken’s parent company filed a lawsuit against the anonymous reviewers and tried to force Glassdoor to reveal their identities. The court ordered Glassdoor to return some of the names.

In Glassdoor, Mr. Powell has a 96 percent approval rating. The site adds: “This employer has taken legal action against the evaluators.”

In Kraken, Mr. Powell is part of a slack group called trolling-999plus, according to posts seen by The Times. The group “thought you were full of … and 4chan trolls,” referring to the anonymous online message board known for hate speech and radicalizing some gunmen behind the mass shootings.

In April, a Kraken employee posted a video inside a different Slack group, which created the last weak one. The video featured two women who said they preferred $ 100 in cash to Bitcoin, which at the time cost more than $ 40,000. “But that’s how the female brain works,” the staff commented.

Sir. Said Powell. She said the debate over women’s mental abilities was unresolved. “Most U.S. ladies have had their brains cleared in modern times,” she added in an interview with The Times in Slack.

His comments sparked anger.

“It is painful to make jokes or clarify this situation because people seeking leadership and proclamation are clearing our brains in this context,” one female employee wrote.

“It’s not gratifying to see your gender’s minds, abilities, and priorities discussed in this way,” wrote another. “It’s terribly different and it’s detrimental to women.”

“Being insulted is not harming,” he said. Powell replied. “The debate over science, the biology, trying to determine the facts of the world cannot be harmful.”

At the June 1 plenary meeting of the company, Mr. Powell was discussing Kraken’s global footprint with staff in 70 countries when it came to the topic of preferred pronouns. Kraken said in a video call that it was time to “control the language.”

“It’s not practical to allow 3,000 people to personalize their pronouns,” he said.

On the same day, he invited staff to join the Slack channel called “discussion pronouns,” where he suggested people use pronouns based on their gender identity, but by born sex, according to interviews seen by The Times. He closed the answers to the thread after the conflict.

Sir. Powell reopened the discussion about Slack the next day to ask why people couldn’t choose a race or ethnicity. He later said who could use the word N in the conversation, stating that it was not applause when used with love.

Sir. Powell also released a cultural document called “Kraken Culture Explained.”

“We don’t prohibit offensive,” a section read. Another said staff should show “tolerance for multiple thoughts” and stop labeling comments as “toxic, hateful, racist, xphobic, unhelpful, etc.” and “avoid censoring others.”

He also explained that the company has rejected the vaccination requirements in the name of “Krakenite Body Autonomy”. In the “Self-Defense” section, he said that “law-abiding citizens should be able to arm their weapons.”

“These cryptographic and libertarian values ​​may need to be regularly considered when making work decisions,” he said.

In an edited version of the document, which was publicly published by Kraken, references to Covid vaccines and the company’s belief in allowing people to arm themselves were ruled out.

Those who disagreed with the document were encouraged to leave. At the June 1 meeting, Mr. Powell introduced the “Jet Ski Program,” which the company described as a “re-engagement” with its core values. Those who felt uncomfortable had two weeks to leave, with a four-month salary.

“If you want to get out of Kraken,” read a note on the program, “we want you to jump on a type ski and feel happy about your next adventure!”

Kitty Bennett and Aimee Ortiz assisted by research.

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