Coinbase appears to be stealing the show amid the FTX crisis.
The previous day has been rather eventful. On the one hand, Meta’s Zuckerberg stated that tomorrow will mark the start of the company’s huge layoffs. On the other side, the announcement of Binance’s acquisition of FTX came a few hours earlier.
The latter choice was unexpected and caught many people off guard. FTX’s ship was temporarily prevented from sinking, but the community still saw it as a warning sign. CZ and Binance were openly criticized for attempting to control the market.
The CEO and Co-Founder of CryptoQuant, Ki Young Ju, noted that FTX was the third-largest exchange in terms of spot volume. He inquired, “How other exchanges can exist and compete against Binance,” in light of the most recent acquisition.
Having said that, there were also others on the other side of the argument who thought CZ’s most recent choice was a brilliant one.
Has the FTX saga benefitted Coinbase?
Following the Binance-FTX “drama,” a recent Bloomberg story revealed that cryptocurrency exchange Coinbase Global Inc. was experiencing “increased activity” on its trading platform.
According to CoinGecko data as of press time, Coinbase settled $5.27 billion in volume over the previous 24 hours as opposed to the $3.8 billion mentioned in Ki Young Ju’s tweet.
People in the industry believe that coming forward, exchanges will fall one after the other like dominoes, even though the same is a positive conclusion for Coinbase. Armstrong clarified the situation by saying there wouldn’t be a Coinbase version of the story since his business doesn’t engage in “risky actions.” He added,
“We’re not investing customer funds. We’re not doing market making or engaged in any kind of complex arrangement with other parties that we own.”
SBF made it clear yesterday that FTX US was not included in the Binance transaction. Is Coinbase interested in acquiring the same, then? So, probably not. Armstrong disclosed that his company has no intention of attempting to acquire FTX US. Without going into specifics, he stated that there were several reasons why the acquisition wouldn’t be beneficial.
While Robinhood suffered from the current situation, Coinbase benefited. Sam Bankman-Fried of FTX acquired more than 56 million HOOD shares in May of this year, giving him a 7.6% interest in the well-known trading app.
According to current rumors, Bankman-Fried will need to increase liquidity by selling some or all of his stake. Pessimism, anxiety, uncertainty, and doubt caused the value of Robinhood shares to drop by 19% on Tuesday.