In a note to staff, crypto exchange Coinbase CEO Brian Armstrong assured that compared to the other struggling or failing crypto exchanges, their firm would survive even as the company’s shares showed a record fall.
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The price of a share of Coinbase stock dropped to an all-time low on Tuesday, closing at less than $39 for the day.
“This is our moment to shine,” Armstrong stated in a message acquired by The Block. He added: “It was not always easy, as we saw competitors skirt rules and rocket up in value and media attention.”
The 39-year-old cited “large withdrawals happening on Binance” as a possible cause of market instability and urged employees to be “prepared to serve” consumers in this environment.
The Coinbase executive also made an effort to inform staff that Coinbase has $5 billion in cash on its balance sheet, safely holds customer assets, and has no substantial exposure to competitor Binance.
The crypto sector has been on heightened alert since the failure of the FTX exchange, which was caused by clients’ huge demands to withdraw funds from their accounts.
Simon Cousaert, director of data at The Block, says that since Monday, there has been a net outflow of more than $2 billion in different crypto assets from Binance, which is the largest cryptocurrency exchange platform in the world by daily volume.
Coinbase Could Benefit from Binance’s uncertain position
Binance estimates its wallets contain assets worth over $60 billion. After Binance commenced processing withdrawal requests for USDC at around noon EST, the value of its BNB cryptocurrency fell by 2.1%.
According to Binance CEO Changpeng Zhao, the exchange briefly halted processing withdrawals owing to low platform reserves.
Binance contacted a top accounting company operating on a global scale, Mazars, to verify the safety of Binance’s collateral. The Wall Street Journal interviewed an accounting and financial expert, who indicated that Mazars’ audit did not fully show transparency but did reveal some weaknesses that were covered by the exchange.
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