coinbase bloodbath

The recent bloodbath in the cryptocurrency markets has meant that there are likely to many more companies that announce they are insolvent in the coming weeks, either because they had direct exposure to FTX via lending, had funds deposited onto FTX, or simply cannot withstand the fact that prices are tanking once more.

Binance, Coinbase and Kraken are some of the few dominant exchanges that are left alive in the markets, and it seems as though they may be able to capitalise on this status of having a pulse.

A collapse of this magnitude is bad for everyone

There have been some speculating that the collapse of FTX was orchestrated by CZ in a bid to try and completely dominate the industry, but he has reiterated several times that collapses of this style and scale is not beneficial for anyone – despite the fact that his closest competitor has gone down in flames, the level of contagion is so extreme that all assets are likely to fall significantly from here.

Coinbase is no exception to this, and is also expected to suffer significantly. Trust has been eroded in centralised exchanges in a way that the crypto markets haven’t been forced to contend with before – there have been large collapses, but not as such as scale as the FTX meltdown.

Coinbase is still standing – immune from the bloodbath?

Coinbase, Kraken, and Binance will still emerge from the ashes when the bear market comes to a close.

As long as there aren’t further liquidations to come, and as long as it doesn’t emerge that any of these exchanges have taken actions as irresponsible as FTX, it seems that they will be able to rise from the ashes like a phoenix.

Extreme damage may have been done to the industry, but bear markets don’t last forever.

Coinbase joins the commitment to show proof of reserves

In addition to moves made by Binance to demonstrate proof of reserves, the CEO of Brian Armstrong has also highlighted that Coinbase is interested in doing this.

Greater transparency for the space if it is to grow, especially since it is something that regulators will want to see coming anyway.

Coinbase now dominates in the US

The reason that Binance originally invested in FTX was due to concern that Binance wouldn’t be able to flourish within the US, but after SBF decided to register in the Bahamas this advantage became not so significant.

Whilst Binance remains a rather international entity, the majority of Coinbase’s users are still in the US, where they are now very dominant.

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