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Coinbase CEO Brian Armstrong reassured concerns regarding the firm’s stability after Binance announced its FTX buyout on Twitter.
Armstrong’s tweet covers the FTX announcement, saying he has a lot of sympathy for the people involved in the current FTX situation.
“Coinbase doesn’t have any material exposure to FTX or FTT (and no exposure to Alameda),” said the Coinbase CEO.
Recently before the news broke out, Binance CEO Changpeng Zhao turned down an offer to sell its FTT holdings to Alameda Research.
A quantitative trading firm that provides liquidity in digital assets markets, Alameda Research was founded in 2017 by FTX CEO Sam Bankman-Fried.
Recently, in July, Voyager Digital, a bankrupt crypto broker, revealed in a court filing that the trading firm owed them $377 million.
Additionaly, two months ago, Alameda agreed to pay Voyager $200.
“I think it’s important to reinforce what differentiates Coinbase in a moment like this,” said Armstrong.
“This event appears to be the result of risky business practices, including conflicts of interest between deeply intertwined entities and misuse of customer funds.”
According to Brian Armstrong, those are behaviors that Coinbase doesn’t engage in.
He also said the firm doesn’t move the customer funds unless they request it and that customers can withdraw their funds anytime.
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Last year, Coinbase became a publicly traded company.
However, as a publicly listed company in the United States, Armstrong believes transparency and trust are essential.
“Every investor and customer can see our public audited financials,” said the Coinbase CEO. “Which shows we hold customer funds.”
“We’ve never issued an exchange token,” Armstrong said.
The CEO was referencing the FTT token, which serves as a collateral for futures positions, trading fees discounts, and OTC rebates.
As of this writing, the FTT token is selling at $4.77, which is down 67.3% in the last 24 hours.
Read also: Step-by-Step Guide for Transferring Cryptoassets from Binance to Coinbase
Brian Armstrong says that the problem with cryptocurrency exchanges is the regulators’ focus “onshore” while customers switch offshore to companies with shady business practices.
“To take the US as an example,” the Coinbase CEO started.
“95%+ of crypto trading has developed overseas because crypto regulation in the US has been hard to navigate.”
“That’s bad for the US and Americans who are still losing money in these overseas blowups,” he added.
Although Binance is in the process of acquiring FTX, the deal doesn’t include its US subsidiaries, Binance US and FTX US.
Coinbase CEO says company doesn’t have ‘any material exposure’ to FTX or Alameda