Despite rumors, Coinbase has no plans to buy FTX US, for now

The contagion from the FTX token collapse has spread to the entire crypto market. On Tuesday, November 8, the broader crypto market lost nearly $100 billion, collapsing by 10%. Coinbase’s stock also collapsed by 10%, ending Tuesday’s session at $50.

Binance announced the buyout of the FTX exchange following a call from Sam Bankman-Fried. However, the buyout is only of FTX’s non-U.S. operations.

At the same time, Coinbase chief Brian Armstrong also said he was not interested in a move similar to Binance’s, distancing himself from any potential acquisition of FTX U.S. In an interview with Bloomberg Television, Armstrong said:

“We don’t invest client funds. We don’t do market making and we don’t engage in any kind of complex arrangement with other parties that we own.”

Note that Binance’s agreement with FTX is still not closed and both companies need to do due diligence on their end. Coinbase’s CEO added that if the Binance deal falls through, it would mean that FTX’s customers could suffer some losses. “This is not a good thing for anyone“, he said.

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Coinbase CEO on crypto-currency regulation

Coinbase CEO Brian Armstrong said that customer activity has increased since the FTX issues were resolved. He also added that customers are taking the route of less regulated offshore exchanges, which exposes them to increased risk.

Armstrong also added that it would make sense for them not to buy FTX U.S., but he didn’t provide enough detail on that. But he did add that the financial difficulties FTX is facing would taint regulators’ opinions of the crypto industry.

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As we know, Sam Bankman-Fried has been lobbying lawmakers in Washington. He is also a major donor to the U.S. Democratic Party. “There are probably a lot of people in Washington right now scratching their heads“, said Brian Armstrong.

Although COIN stock fell sharply Tuesday, Cathie Wood Ark Invest invested heavily. Ark Invest bought 420,000 shares of COIN stock worth $21 million on Tuesday. COIN stock is now trading at an 80% year-to-date discount.

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