Coinbase published a report in which the company shared its losses. Following this report, there’re circling rumours that in case the company goes bankrupt, clients can face a loss. These rumours are attracting people on social media. Coinbase Chief Executive Officer Brian Armstrong came forward and made it clear that clients’ funds are secure. That’s why there’s no need to worry.
First-quarter of 2022 proved bad for Coinbase. According to the report, the company faced a loss of $430M. It’s not ended here. The company also shared that the number of clients doing transactions in exchange decreased from 11.9M to 9.2M. Following the loss report, there have been seen concerns about the protection of bankruptcy on Twitter, citing disclosure in which it is stated that in case of bankruptcy, the clients’ cryptocurrency assets might be connected with bankruptcy proceedings. Adding more, according to this disclosure, the customers will be considered “unsafe creditors” in case this happens. It is speculating that in case, Coinbase goes bankrupt, the coins under the custody of the firm will be its property.
CEO Armstrong reacted to these concerns by saying that there’s no truth in these rumours about the firm’s bankruptcy and the clients’ assets are secure, so there’s no need to worry. Nevertheless, he said that in the case of the firm’s bankruptcy, there’s no possibility that the court, in its proceeding, will decide to consider customers’ funds as a share of the firm. Chief Executive Officer Armstrong made it clear that the company provides its elite and custody clients with solid legal safety within conditions of service. Even these conditions ensure asset protection if the company goes bankrupt.
He also added that the professional team is updating the firm’s terms & conditions to provide the same safety to retail customers. Despite circling rumours about the loss report, the Chief Executive Officer of Coinnebase, Brian Armstrong, is still energetic. Despite the current difficult situation, the company’s CEO Brian Armstrong is looking determined; he says that this is not the first time; the company is facing this kind of situation. He said that Coinbase faced many cryptocurrency cycles, including many ups and downs that accelerated their working ability.