- Brian Armstrong, the CEO of Coinbase has disclosed that the company holds $39.9 billion worth of Bitcoin.
- Coinbase Custody Trust, the Investment arm of Coinbase Global is said to hold $635,000 BTC from Grayscale Trust.
The crypto market’s mass effort of transparency has been on the rise amid the collapse of the FTX empire. General investors’ confidence remains low as Fear, Uncertainty, and Doubt (FUD) become a challenge for the existing firms. In a recent shareholders letter, Brian Armstrong, the CEO of the exchange disclosed that the company holds $39.9 billion worth of Bitcoin.
According to him, their financials are public and should be taken note of in the emergence of FUD. The market response to the FTX collapse was a cause for concern as high liquidation was triggered, causing a pullback in the market. For this reason, Armstrong has called for unity to build the crypto ecosystem.
We hold ~2M BTC. ~$39.9B worth as of 9/30 (see our 10Q) pic.twitter.com/TFINAgOSeZ
— Brian Armstrong (@brian_armstrong) November 22, 2022
We all need to come together to build this industry in a responsible way going forward.
Coinbase Custody Trust, the Investment arm of Coinbase Global is said to hold $635,000 BTC from Grayscale Trust.
While this effort is being commended, a section of the crypto community believes that it is the failure of FTX that is making firms take measures of transparency for current and prospective customers.
Through this process, we have gotten a lot of interesting notes about the various asset holdings of these cryptocurrency platforms.
Coinbase massively affected by the FTX drama
The FTX drama has affected centralized exchanges including Coinbase with the exchange losing over a quarter of its value in four trading sessions. On Monday, Coinbase shares closed down over 8 percent to extend the exchange to its lowest point since April last year. Also, with a market cap of $85 billion after going public, Coinbase fell below the $10 billion mark. Armstrong earlier clarified that his company did not have any material exposure to FTX. However, he sympathizes with everyone involved.
It’s stressful any time there is potential for customer loss in our industry, and a lot of people are losing a lot of money as a result of FTX’s struggles.
After the FTX bankruptcy, Bank of America downgraded Coinbase, citing “contagion risk.” According to them, this is true for the exchange even if it is not another FTX.
That does not make them immune from the broader fallout within the crypto ecosystem.
Coinbase reported a more than 50 percent revenue plunge in the third quarter of this year from the previous year. It also recorded a loss of more than $545 million. According to reports, the exchange reduced its workforce by more than 18 percent.
In the case of FTX, the exchange went from a $32 billion valuation to bankruptcy after citing a lack of liquidity coupled with mass withdrawals and the collapse of the Binance bailout. According to the former CEO of FTX Sam Bankman-Fried, the company is trying to recover deposits for the customers.
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