Brian Armstrong of Coinbase States Coinbase Has No Ties To FTX

Brian Armstrong announces Coinbase is Stable after buyout of FTX by Binance

Brian Armstrong Speaks 

The CEO of Coinbase went to Twitter and addressed all concerns about any exposure Coinbase had to FTX as the once Coinbase competitor is no longer in the picture as Binance , another rival, has outright purchased the company.

Armstrong started by stating he had a lot of sympathy for those involved in the situation and knew how stressful things may be.

Armstrong then continued to stress that Coinbase had zero material exposure to FTT or FTX and absolutely no relationship with Alameda Research.

Before the acquisition, Binance CEO Changpeng Zhao refused to sell the FTT holding Binance had in an over-the-counter deal with Alameda Research.

Alameda Reserach is the parent company of FTX, and was founded in 2017 by Sam Bankman-Fried. The firm is a quantitative trading firm providing liquidity in digital assets markets. This past July 2022 saw Voyager Digital stating that Alameda owed them $377 million with Alameda agreeing to pay $200 million of that outstanding crypto loan.

Armstrong stated there were indeed very big differences between how his company handles business and how things were handled by Alameda.

“I think it’s important to reinforce what differentiates Coinbase in a moment like this, This event appears to be the result of risky business practices, including conflicts of interest between deeply intertwined entities, and misuse of customer funds.”

Armstrong made it clear that there were certain behaviors that were explicitly avoided by Coinbase. He stated that Coinbase doesn’t do anything with customers’ assets unless the customer explicitly states to and made a point to express how customers can withdraw their funds at any time.

The Coinbase Difference

Coinbase became a publicly traded company, with its stock trading on Nasdaq under the ticker symbol “COIN.” The move makes Coinbase the first cryptocurrency exchange to go public in the United States. In the wake of the news, Coinbase’s CEO and co-founder Brian Armstrong sat down for an interview with CNBC’s Deirdre Bosa. Here are some highlights from that conversation.

The Challenges Facing Cryptocurrency Exchanges Today

One of the big issues facing cryptocurrency exchanges today is regulation. According to Armstrong, regulators have been focused on “onshore” exchanges (i.e., those based in the United States) while customers have moved offshore to exchanges with murkier and riskier business practices. This has put U.S.-based exchanges at a disadvantage.

How Coinbase Is Differentiating Itself from Other Exchanges

Coinbase is one of the few exchanges with a clean regulatory history, which Armstrong believes gives it a leg up on its competitors. He’s also optimistic about the future of the company given its recent listing on Nasdaq. “As a publicly listed company incorporated in the United States,” he said, “we believe transparency and trust are essential.” He went on to say that “every investor and customer can see our public audited financials,” which show how customer funds are held.

Cryptocurrency exchanges are facing some challenges right now, but Coinbase appears to be weathering the storm better than most. With its strong regulatory history and commitment to transparency, Coinbase may be a safe bet for those looking to invest in this risky but potentially lucrative market.

Brian Armstrong

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