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Coinbase Global, Inc. shares are down more than 85%
Coinbase Global, Inc. (COIN) shares, which are down more than 85% from their highs, are not out of the woods just yet, as a slew of fresh difficulties await.
As if falling Cryptocurrency prices weren't enough, COIN is also dealing with more competition and the potential of fee reduction. Binance.US, the U.S. affiliate of the world's largest crypto exchange, Binance, has been ramping up in the U.S., significantly growing person count at a time when COIN has cut it and receiving money for the first time from external investors in a fundraising round valued at $4.5 billion. Binance.US intends to utilize the money infusion to improve its platform and expand marketing expenditure in the United States, which might help it wrest market share from COIN.
The CEO of Binance.US Brian Shroder believes the firm is on pace for an initial public offering in the United States over the next several years, which would provide it with additional financing and exposure. Binance, which is privately held, says it has raised a big "war chest" and plans to take up smaller sites in 50 to 100 acquisitions during the current Cryptocurrency bear market.
Meanwhile, FTX is attempting to acquire momentum in the United States. As anyone who has seen the Super Bowl or a Major League Baseball game this season can confirm, FTX is extensively promoting to lure users in the United States. FTX is run by crypto millionaire Sam Bankman-Fried, who has been striving to intervene and help stabilize platforms that are dealing with solvency during the current crypto bear market in order to prevent the contagion from spreading to the whole crypto sector.
FTX, situated in the Bahamas, was valued at $32 billion in a fundraising round earlier this year. FTX US was worth $8 billion. Bankman-Fried also recently purchased a position in Robinhood Markets, Inc. (HOOD), making him the company's third-largest stakeholder, sparking suspicions of a takeover. Bankman-Fried has denied that this is his goal, although he does believe the firms may collaborate in other ways. In any scenario, one thing is certain: COIN will face increased competition from two huge, deep-pocketed competitors who have been successful outside of the United States.
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Page Updated Last on: Aug 12, 2022