COIN stock price hit despite Coinbase ‘seeing inflows’ after FTX collapse: Armstrong
17:32, 9 November 2022
Coinbase (COIN) shares felt the knockout effect of the cryptocurrency market crash, despite the fact that the world’s biggest publicly-listed crypto platform actually benefited from the struggles of its competitor, FTX, which had sparked the market rout.
Coinbase’s chief executive, Brian Armstrong, told Bloomberg that his company “definitely [saw] increased activity” and “good inflows and activity on the platform” as investors rushed to transfer their funds out of the embattled FTX.
But at the time of writing COIN shares were down 8.5% over the last 24 hours of trading.
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Coinbase Global Inc (COIN) share price chart
FTX exodus, Coinbase’s inflows
The cryptocurrency market dived a staggering 16.5% over the last 24 hours, and bitcoin (BTC) sank to a two-year low after FTX declared it did not have enough liquidity to satisfy its clients’ withdrawals.
The troubles for FTX started last week when rumours of its insolvency began spreading and investors rushed to get their funds from the platform. While the withdrawal influx turned out to be disastrous for FTX, its competitors benefited from the troubles.
Another sector behemoth, Binance, offered to help FTX with liquidity after the two signed a non-binding agreement that Binance would fully acquire FTX on Tuesday 8 November. However, Binance is now reportedly leaning not to go ahead with the agreement after examining FTX’s books, according to CoinDesk.
Armstrong clarified Coinbase was not interested in acquiring FTX’s US subsidiary, FTX.US, in the interview. Armstrong told Bloomberg that “there’s reasons why that would not make sense” but said he is not “at liberty to share the details right now” and will let other people reveal the information “if and when they are ready”.
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