Coinbase Reports Significant Drop in Consumer Trading Volume Raising Concerns for Crypto Industry
Coinbase has reported a significant drop in consumer trading volume, which has raised concerns for the crypto industry.
On Thursday, the largest US-based cryptocurrency exchange released its second quarter earnings report, revealing that transaction volume for consumers and institutions has declined by 70% and 54%, respectively, compared to the same period last year.
Coinbase attributed this decline to several factors, including the decrease in the overall market capitalization of cryptocurrencies.
The average prices of cryptocurrencies have fallen sharply since the 2021 highs, and the market has experienced low volatility, which has diminished the opportunities for big returns.
Bitcoin (BTC), the most prominent cryptocurrency, has remained relatively stable since March, further contributing to the decline in trading volume.
This decline marks a major reversal for the crypto industry, which was all the hype just a year ago.
At the 2022 Super Bowl, crypto companies and exchanges were as prevalent as beer and pickup trucks in America.
However, the downward spiral began shortly after as the US Federal Reserve raised interest rates.
Crypto giants such as Three Arrows Capital, Celsius, Voyager Digital collapsed, and FTX experienced a high-profile implosions that wiped out $2 trillion in market value.
Coinbase itself has also faced challenges.
The exchange initiated layoffs last summer, with 1,100 employees losing access to their company email accounts.
It has continued to make cuts this year, reducing its employee base by another 20% at the beginning of 2023.
Back in June, the SEC sued both Binance, the world's largest cryptocurrency exchange, and Coinbase, the largest US-based cryptocurrency exchange.
The commission has accused
Read more on cryptonews.com
