> Instead of a four-year new hire grant (standard at many tech companies), employees will receive annual grants, sized at one-year targets that vest in their entirety each year.

So... this means that the stock option compensation is less volatile (because your options gained over 4 years work from 4 different base values, rather than just a single one). BUT on the other hand, it rewards employees according to the one-year gains, rather than gains over a longer period of time.

What impact do you think this will have both on employee compensation and on long-term vs short-term thinking (one major reason given for using stock options as compensation is to align the interests of employees and stockholders)?

All else equal (i.e. they aren't increasing the size of the equity grant to compensate), this is nearly always much worse for the employee. Part of what you get from a 4-year grant with a fixed number of RSUs is an implicit option on the underlying equity - you benefit if it goes up, but if it goes down you can always just leave and go somewhere else to "reset" your compensation, assuming for the sake of argument that someone who can get a job at Coinbase can also get a job at a company that pays comparably well.

Obviously there's the risk of a more general downturn in the overall engineering job market, but that's a small fraction of the potential causes of a drop in Coinbase's stock price.

Moving to a 1-year grant removes the bulk of that option's value in exchange for downside protection that you'd have most of the time anyways. The situation where it's helpful is if you specifically love your company/team/etc and want to be able to stick around without taking a massive paycut, but you're hardly likely to know that before you even join (when you see the offer).

I don't see the appeal of one year grants from the employee side.

They’re reacting to the new hires who are mad that the stock is currently down.

Instead of RSUs, could I get Bitcoin instead?