What happened
Shares of cryptocurrency company Coinbase Global (COIN 12.99%) jumped as much as 13.8% in trading on Tuesday and closed up 13% for the day.
So what
As crazy as it sounds, there may be more stability in the crypto market today than there’s been in the last few weeks. Celsius, which is under financial stress, paid back $161 million in debt to lending protocol Maker over the last three days, although it still owes at least $300 million to other lenders.
Cryptocurrency lender Nexo signed a term sheet to acquire Vauld, which would be another potential bailout of a troubled firm. Three Arrows Capital, which was once one of the largest hedge funds in crypto, didn’t reach the same outcome and has now filed for bankruptcy in New York as well as being ordered to liquidate in the British Virgin Islands.
Now what
The fact that cryptocurrencies aren’t completely melting down, and have rallied at times over the last few days, is a positive sign given the number of insolvencies we’ve seen in the market. Lending protocols are freezing funds and don’t seem to have the liquidity they need to survive. But the system hasn’t collapsed.
If Coinbase can simply survive this market turmoil it could come out in a great position. The crypto market will likely be lower risk and the developers building innovative solutions for the blockchain will still be building. That’s bullish for Coinbase and its growing suite of wallet and cloud solutions for Web3.
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