Coinbase’s affiliate program suspension has sparked suspicions that the exchange may be experiencing a liquidity crunch.
Some crypto community members feel that the affiliate programme suspension indicates the company’s insolvency.
CoinGeek media personality Kurt Wuckert Jr. tweeted that the exchange’s closure of “Coinbase Pro” and “affiliate programme” might signal a liquidity issue.
Wuckert is not the only crypto influencer to have these views, as Nate O’Brien and BitBoy have both expressed concern about a potential liquidity crisis. BitBoy said in a tweet that Coinbase’s bankruptcy “will shatter the crypto industry like never before.”
The Community Supports Coinbase
Meanwhile, others argue that the prevailing viewpoints are just FUD. A Twitter user noted that it is typical for businesses to reduce expenses during a recession.
According to Kraken’s Dan Held, the termination of a partner program is not indicative of a liquidity concern.
Others agreed with him, like NJ Skoberne, who tweeted that “closing it down has nothing to do with liquidity.”
Crypto Additionally, YouTuber jungleincxrp stated that Coinbase has around $6 billion in cash and huge cryptocurrency reserves. However, he said that he had removed every asset from the exchange.
John Deaton, a cryptocurrency attorney, says industry leaders would “NEVER allow a Coinbase bankruptcy” owing to the domino impact such an event would have on the cryptocurrency sector.
The CEO of Coinbase, Brian Armstrong, has attempted to dispel suspicions by stating that the exchange is well financed and still has incredible growth to absorb after a significant expansion in 2021.
The latest liquidity crisis in the crypto business has already resulted in the demise of three big companies and the loss of billions by thousands of users.
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