Binance Moves Funds from USDC to Another Stablecoin
During Coinbase's second-quarter earnings call, CEO Brian Armstrong mentioned that Binance had moved some of its funds from USDC to another stablecoin, but despite this, the market cap of USDC has remained steady. USDC is the preferred stablecoin on Coinbase, and Binance once held a significant amount of USDC reserves, but it seems they have converted some of their holdings to other stablecoins. Binance has been redeeming USDC for USD recently, with many believing it is going towards their new stablecoin of choice, FDUSD. USDC's market cap has shrunk by nearly half in the past year, falling from $44.5 billion to $26 billion.
Crypto-focused Companies Report Profit in Q2 2023 amid Crypto Market Rally
Several crypto-focused companies, including MicroStrategy, Coinbase, Coinshares, Block, and Robinhood, have reported record profits in Q2 2023 following a minor crypto market rally. MicroStrategy increased its BTC holding by 12,333 BTCs, bringing its total BTC holding to 152,800, and recorded a gross profit of $93.3 million. Coinbase posted total revenue of $707.9 million but remained in loss despite the crypto market rally. The positive performance in Q2 2023 has led analysts to speculate that the crypto winter may be over, but the outcome of Q3 will determine the future for many of these companies.
Coinbase's Layer 2 Base Sees Over $100 Million in Value Bridged from Ethereum
Coinbase's Layer 2 solution, Base, has seen over $100 million in crypto assets bridged over to it, according to L2beat. Base's roll out is part of Coinbase's "Onchain Summer" initiative, which includes collaborations with brands such as Coca-Cola and OpenSea. Coinbase sees Base as an investment in blockchain infrastructure that will drive down transaction costs and increase transaction speed, unlocking new use cases over time.
Coinbase Faces Challenges as Consumer Transactions Slide
Coinbase, the world's second-largest cryptocurrency exchange by volume, has recorded a decline in consumer transactions, signaling challenges for the exchange. Regulatory scrutiny and market factors are contributing to this trend. In its second-quarter earnings report, Coinbase revealed significant decreases in transaction volumes for both consumers and institutions, with a 70% and 54% decline, respectively, compared to the same period in the previous year.
Coinbase CEO Brian Armstrong Reveals Binance Sold Its USDC Holdings in Earnings Call
During Coinbase's Q2 earnings call, CEO Brian Armstrong unexpectedly disclosed that Binance had sold all its holdings of the stablecoin USDC, causing its market cap to increase. Armstrong's statement implied that USDC is now safer without Binance's involvement. However, USDC's market cap has been declining rapidly, dropping from $44.5 billion to $26 billion.
Global X Files Application for Bitcoin ETF with Investor Protections
Global X has submitted an application to list a spot bitcoin ETF product, which would provide investors with exposure to bitcoin while offering important protections not available to those who invest directly in the cryptocurrency. This marks the ninth active spot-bitcoin application filed with US regulators, and Global X has named Coinbase as its surveillance-sharing partner to gain regulatory approval. Other pending applications, including those from Fidelity and BlackRock, have also announced surveillance-sharing agreements with the exchange in response to previous SEC rejections of bitcoin ETF applications. Global X has also filed for permission to create a bitcoin-futures ETF and establish a fund that tracks the CoinDesk Bitcoin Trend Indicator Index.
Coinbase's Q2 Earnings Beat Estimates Despite Low Crypto Market Volumes, Looks to Offer Leverage to Users
Despite lower metrics in the spot crypto market, Coinbase's earnings report exceeded Wall Street's expectations. The decline in transaction-based revenues was offset by higher-than-expected interest income and blockchain rewards revenues. Coinbase is also operating leaner, with lower total operating expenses. The platform is looking to offer leverage to its users through Coinbase Prime Financing, which offers long and short leverage based on dynamic, risk-based margining. Coinbase's derivatives market has reportedly traded over $5.5 billion in notional contract volumes with over 50 institutions onboarded, and the platform is looking to add more leverage features to keep advanced traders engaged.
Debate over New York's crypto mining policies heats up at Coinbase town hall
Coinbase's inaugural crypto policy town hall in New York City turned into a heated discussion about the state's ban on certain mining practices. The two-year moratorium on fossil-fuel powered proof-of-work mining facilities in New York, signed by Governor Kathy Hochul in November 2022, has been controversial, with environmental concerns cited by advocates and stifled innovation and job losses by adversaries. The discourse around cryptocurrency in the New York state legislature was positive until environmentalists got involved, causing a loss of support for bills on blockchain. The moratorium will expire in 2024, but there may be efforts to extend or expand the ban.
Coinbase cites Ripple case in bid to dismiss SEC lawsuit
Coinbase has used the recent Ripple Labs case to argue against the Securities and Exchange Commission's (SEC) case against them. The crypto exchange claims that the SEC's attempt to classify a simple asset sale as a security is an unprecedented stretch, and that the judge's recent decision with Ripple supports their argument. Coinbase also cited the major questions doctrine, which requires clear congressional authorization for an agency to decide on an issue of major national significance, as applying to their case against the SEC. The SEC and Ripple have been in a legal fight since 2020, when the agency accused Ripple of raising $1.3 billion through the sale of XRP, which it says is an unregistered security.
Coinbase argues SEC lacks authority to pursue enforcement action in latest filing
Coinbase has filed a motion to dismiss the US Securities and Exchange Commission's (SEC) case against the company, arguing that the SEC has "violated due process, abused its discretion and abandoned its own earlier interpretations of the securities laws." Coinbase claims that the "subject matter falls outside of the agency's delegated authority" and that the SEC can only pursue enforcement action if the relevant transactions are "investment contracts" and therefore "securities" under the Securities Act of 1933 and the Securities Exchange Act of 1934. Coinbase also argues that the SEC cannot "retroactively" regulate digital asset exchanges and that the Major Questions Doctrine would require dismissal of the complaint. The SEC sued Coinbase in June for allegedly operating as an unregistered exchange and offering unregistered securities.
