With massive losses, Coinbase is at high risk for bankruptcy. Coinbase quarterly earnings were a $430 million dollar loss. As one of the larger exchanges this puts a lot of client assets at risk. Coinbase is custodian for over $250 billion dollars in assets. Needless to say, many users hold assets on centralized exchanges.
A new provision in their 10-Q to the SEC has users concerned. A 10-Q is a report filed to the SEC to disclose a companies view on their financial position.
This new change discloses a risk to end users if Coinbase does go backrupt. With their massive quarterly losses, this is a very real posibility.
Specifically if you look at this part:
Because custodially held crypto assets may be considered to be the property of a bankruptcy estate, in the event of a bankruptcy, the crypto assets we hold in custody on behalf of our customers could be subject to bankruptcy proceedings, and such customers could be treated as our general unsecured creditors,
This is a real concern and has shown to be an issue with the ongoing Cryptopia hack and subsequent liquidation.
Coinbase CEO assures users this isn't a problem on a Twitter thread.
While Coinbase reassures there is no risk, it is something to be aware of. As always, do your own research, but anyone using Coinbase should be aware of these changes and potential risks.
To be honest though, I do believe this risk exists with every centralized exchange used even if it isn't fully disclosed.
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That's a huge risk if someone is holding more than 10% of their heavyweight portfolio on exchanges. Non-custodial wallets come with more responsibility but definitely worth for the hodlers.
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THIS! "not your key(s), not your coins"
I know it's been said a trillion times, but let's say it one more time: not your keys, not your coins.
Thanks for the heads up.
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Thanks for tipping on us. These are really hard times for Crypto companies. And you can't blame them much on what they are doing as they are trying to put their users at ease with everything going on.
The danger when we put assets in centralized entities. If it goes bankrupt, we risk losing those assets.
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Good to know. Add it to the list of reasons to not hold crypto on an exchange.
Coinbase, i love coinbase because in 2014 when i try to buy btc they do not Let me.
Imaginé my love for them.
o-oooh! I can imagine that 😁
Imaginé they said me you live in El Salvador AND your country are not autorized to do that, can you believed 8 years ago AND now we have a BTC as a legal tender ohhhhh what crazy life, but well i am ok but maybe i were better.
Can you believe, I dont have even 0.05 BTC. And never had :=)
Ehehe... but I am quite skeptic, in general, about crypto as 'selling the air' thing. But Hive is a totally different case! 😍😍😍
Yeah hive give the Worlds crypto to our foot.
Welp, no wonder about the current market prices, this explains a bit, anyway, this is just gonna be the tip of the iceberg, Coinbase ain't the only one dying in this next few months...
Mr DO assured Luna will never crash below 88$ and when it crashed he assured it will go back up ... that is the only way for them to assure their assets but it cannot last .
LOL Coinbase
BTC at 68k - "Hey, we're worth $2 Billion!"
BTC at 29k - "Hey, we've lost $420 Million this quarter. Not really but anyway... now you know!"
#DeleteCoinbase !PIZZA
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Thank you for posting this @themarkymark.
Thanks for the heads up, @themarkymark!
Annabelle 😊
Thanks for the heads up! Have never been a fan of Coinbase and that Twitter thread did not instill confidence.
Meanwhile the $LUNA graph is more entertaining than TV 📺 Had some investor friends lose big there, so interested to see if the Terra Luna dev team can come back from this!
Short or long? 😁
I think I'll just go ahead and remove anything I have on there to be sure.
If you've ever used Coinbase to deposit then any address you've ever used (or transferred from one to another) is compromised. If you don't want to cash out through Coinbase you better make sure that NONE of your addresses contains a single input or output that can be traced back to Coinbase.