CryptopocalypseCoinbase CEO Issues Serious Contagion Warning After Bitcoin and Ethereum Price Drop

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BitcoinBTC, Ethereum and other major cryptocurrencies are in the midst of a so-called brutal crypto winter, with around $2 trillion wiped from the market this year (and possibly a $65 billion earthquake just around the corner from the street).

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The price of bitcoin has fallen to less than $17,000 per bitcoin from nearly $70,000 at the end of last year, while the price of ethereum has seen a similar selloff, causing serious problems for some. of the biggest crypto companies.

Now Brian Armstrong, the managing director of one of the world’s largest bitcoin and crypto exchanges, CoinbaseCOIN, has warned that there could be further fallout from the collapse of rival exchange FTX within months. ahead, despite a wave of bullish bitcoin price predictions in 2023.

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Coinbase Chief Executive Brian Armstrong has warned there could be “more contagion” from… [+] collapse of major bitcoin, ethereum and FTX crypto exchanges.

The Washington Post via Getty Images

“I think there might be a bit more contagion from FTX, but hopefully [everything moves] across the system over the next two months, or quarters at most,” Armstrong told Axios in an interview, comparing the panic caused by the collapse of FTX to the collapse of bitcoin exchange Mt. Gox in 2014. “After 18 months, people moved on and no one asked me after that.”

The fallout from last month’s FTX shock implosion has already plunged some of the world’s biggest crypto companies into crisis, with fears still high that other big companies and cryptocurrencies are on the brink of collapse. .

Crypto lender BlockFi followed FTX into bankruptcy last month, raising questions about how many other crypto companies could suffer from FTX’s contagion. Earlier this year, the sudden collapse of so-called algorithmic stablecoin terraUSD and its supporting coin luna wiped out crypto hedge fund Three Arrows Capital as well as crypto lenders Voyager and CelsiusCEL.

Coinbase’s share price has fallen along with the bitcoin, ethereum and crypto market this year, collapsing nearly 90% in 2023 as traders abandon crypto trading platforms, though Armstrong remains optimistic.

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Bitcoin price has suffered an almighty crash over the past 12 months.

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“The bullish case for Coinbase is that we are the market leader in terms of trust and the largest [exchange] in the United States,” Armstrong said. “The market is giving us very clear signals that they want to work with trusted companies if they are centralized players.”

This year’s “cryptopocalypse” and “inflationary pressures” have been named two of the biggest trends of 2022 by a survey of restructuring professionals polled by Petition.

Inflation, which hit 40-year highs this year, has forced the Federal Reserve into a sharp series of interest rate hikes this year, driving down prices across the board and potentially through 2023.

BlackRockBLK BLK, the world’s largest asset manager, has warned that the Federal Reserve will not “rise to the rescue” in 2023, while stock valuations that have moved in parallel with crypto prices “don’t reflect not yet the damage to come”.

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