Cryptocurrency exchange Coinbase has amassed a $ 4 billion “safety deposit”. It will be used to solve possible problems on the exchange itself or in the cryptocurrency industry.
Such a significant stock will help the exchange survive, for example, the tightening of the regulatory environment in the United States or possible hacks. It is also important that the cryptocurrency industry itself is very risky, so cash reserves will come in handy in the event of a significant decrease in the capitalization of the cryptocurrency market, which means a decrease in trading activity.
According to Coinbase CFO Alesia Haas, there was no specific reason to build up cash reserves. However, it’s always best to be prepared for the worst and stock up on good times. The exchange conducted special stress tests to check whether such a reserve would be sufficient in the event of problems with regulators, cyber attacks or a decline in trading volumes.
“We are going to maintain these cash reserves in order to continue to invest in the development of the cryptocurrency industry, to develop our products and services even in a ‘crypto winter’,” says Haas.
Thanks to the growth of the cryptocurrency market and interest in digital asset trading in the United States, Coinbase gained $ 2 billion in revenue in the second quarter of this year. The largest exchange Binance has a similar “emergency fund”.
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