The move of Coinbase to terminate its affiliate project has resulted in rumors saying that the platform might be going through a liquidity crisis. Different people in the crypto community have different opinions as a few anticipate that the suspension of the affiliate program could be a sign of the insolvency of the exchange.
Kurt Wuckert Jr – a figure of CoinGeek media – shared a Twitter post noting that a liquidity crisis might be indicated by this because both the “affiliate program” as well as “Coinbase Pro” had been shut down by the venue. In the previous month, the markets of USDC and USD were combined by Coinbase, along with the termination of the above-mentioned prominent duo projects.
Wuckert and many other crypto influencers, taking into account BitBoy and O’Brien, are of the view that these steps have been taken by the crypto platform following an entire year of the trading of $COIN stock by the insiders. In the case of insolvency of Coinbase, an extremely disastrous situation may be witnessed in the crypto world like never before, according to BitBoy.
Coinbase Defended by Community
In the meantime, some other people assert that such rumors are only FUD. A Twitter consumer referred to it as a normal thing in the case of the firms and its objective is to devalue them. Kraken’s Dan Held stated that a liquidity crisis is not signified by the closure of the affiliate program. A few others also took his side as NJ Skoberne (the person responsible for the organization of the affiliate program) pointed out that there is no connection between the liquidity and the termination of the program.
“Jungleinxcrp” – a crypto YouTuber – additionally tweeted that an amount of up to $6B in cash is possessed by Coinbase along with substantial crypto reserves. However, he added, the entirety of his assets have been shifted from the venue. John Deaton, a crypto lawyer, believes that the bankruptcy of Coinbase will never be permitted by the industry leaders because of the domino effect of such an incident on the whole market of cryptocurrency.
The CEO Reacts
Brian Armstrong – the CEO of Coinbase – has attempted to answer the rumors by claiming that the platform is significantly capitalized and even now has substantial progress following a remarkable expansion during the previous year. The industry-wide liquidity crisis has already influenced the big names in crypto organizations and numerous customers have lost billions.