“Coinbase Has No Financial Exposure to The Crypto Firms That Recently Filed for Bankruptcy”, Says Coinbase.

Today, Wednesday, Coinbase announced that it has no exposure to bankrupt crypto firms.

In a blog published this morning, the crypto exchange’s heads of Institutional Trading, Credit and Market Risk stated that the company had “no financing exposure” to bankrupt firms Three Arrows Capital, Voyager Digital or Celsius Network.

A Coinbase spokesperson said, “Coinbase Ventures has invested in over 300 projects to date, including a broad range of defi projects. We made a small minority investment in Terraform Labs in 2020 and have not been actively involved in the company’s operations.”

According to Crunchbase, Coinbase Ventures was involved in a $25 million funding round led by Galaxy Digital for Terraform Labs back in January 2021.

Coinbase stated in its blog post that these bankruptcies would mark a “major inflection point for the industry.”

The company wrote in the blog post, “Solvency concerns surrounding entities like Celsius, Three Arrows Capital (3AC), Voyager, and other similar counterparties were a reflection of insufficient risk controls, and reports of additional struggling firms are fast becoming stories of bankruptcy, restructuring, and failure,” it further stated that, “Notably, the issues here were foreseeable and actually credit specific, not crypto specific in nature.”

The authors reckoned that the market collapse from Terra ecosystem’s implosion was caused by and compared the situation to popular leverage-induced blowups from the traditional financial sector such as “Long Term Capital Management in the 1990s, Lehman Brothers in the 2000s and even Archegos Capital Management in 2021.”

From the year’s inception till date, shares have been down below 65%. However, Coinbase’s shares were up as much as 7% early Wednesday, increasing the recent gains that made the stock rise above 30% this July.

This rebound in Coinbase comesin the midst of a general turn around in the crypto space.

Coinbase is set to report its quarterly earnings on August 9 at the close of the market.