"Market fear and volatility are our shining moments." Coinbase founder Brian Armstrong encourages employees.
Since the rapid depletion of funds by FTX customers leading to the brink of bankruptcy, the cryptocurrency industry has been on high alert. Yesterday, Binance caused market panic again due to USDC withdrawal issues, according to a report from The Block. Coinbase founder Brian Armstrong issued a memo to employees assuring them that Coinbase, unlike other struggling or failing cryptocurrency exchanges, is urging employees to "be prepared to serve" customers during market volatility, emphasizing that now is the time for Coinbase to shine.
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US Listing Compliance, No Significant Exposure to Binance
Brian Armstrong also mentioned recent market fears on his Twitter, reminding everyone that Coinbase is a US-listed company that complies with regulations, securely storing customer assets in compliance, with a balance sheet that includes $5 billion in cash reserves, and has no significant exposure to its competitor Binance.
1/ Based in the U.S.
— Brian Armstrong (@brian_armstrong) December 13, 2022
Coinbase also announced yesterday that its broker Coinbase Prime has completed SOC 1 and SOC 2 certification. SOC reports are industry-standard certifications managed by the American Institute of Certified Public Accountants (AICPA). Through external audit evaluations, they provide assurance of the control processes and strength implemented to protect customer assets.
Coinbase Stock Hits New Low
Impacted by the ongoing downturn in the cryptocurrency market, Coinbase's stock closed below $39 on Tuesday, hitting a historic low. The decrease in trading volume has significantly impacted Coinbase, which relies on fee revenue as its source of income. It reported a loss of $545 million in just the third quarter of this year, totaling $2.1 billion in losses by the end of September. Fortunately, Coinbase accumulated significant profits during the previous bull market, coupled with ample cash reserves, which should help it weather this bearish period. Recently, Coinbase has encouraged users to convert USDT to USDC for free and offers a 1.5% interest rate, seemingly aiming to expand USDC's market share in collaboration with Circle. In this high-interest-rate environment, it aims to increase some reserve interest income.
