Coinbase clarifies: no exposure to 3AC

Coinbase clarifies: no exposure to 3AC
Crypto exchange Coinbase is responding to rumours that the company is in financial trouble. There were stories that the American exchange was insolvent due to its exposure to Three Arrows Capital. This hedge fund, also known as 3AC, has gone bankrupt, which has left its mark everywhere.

https://twitter.com/CryptoSightnews/status/1549801557469831169


Coinbase unscathed




3AC has defaulted on repaying over $3 billion in debt to its creditors. As a result, many crypto companies are making losses. Coinbase is not, the exchange writes. They have had no exposure to 3AC, Celsius, Voyager or similar parties.

"We believe that these market participants were caught up in the frenzy of a crypto bull market and forgot the basic principles of risk management."

"Unhedged positions and huge investments in the Terra ecosystem and huge leverage positions by 3AC made the risk too high and too concentrated."

Coinbase says it applies "risk management" as its "first principle in the business". Therefore, they claim to be protected against "a potential default contagion".


Coinbase is 'safe'




So there are always winners and losers. Coinbase seems to be quite safe, while competitor FTX seems to be on the up. They are spreading money around and do not hesitate to support or take over failing companies. Whether it is BlockFi, or loans via Alameda Research to Voyager.

Coinbase is having a hard time these past months, despite the fact that they are not affected by the 3AC fiasco. Yesterday, they discontinued their affiliate program and also laid off a significant part of their staff. The cryptowinter is not affecting the altcoin exchange.

At the same time, Blockchain.com and Genesis Trading are clearly victims of the loans to 3AC which have gone wrong. It is not yet clear what the exact consequences will be.
https://www.indexuniverse.eu/coinbase-clarifies-no-exposure-to-3ac/

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