The bitcoin price has crashed under $17,000 per bitcoin, down from almost $70,000 late last year, while the ethereum price has seen a similar sell-off—sparking serious problems for some of the biggest crypto companies.
Now, Brian Armstrong, the chief executive of one of the world’s largest bitcoin and crypto exchanges Coinbase
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“I think there could be a little more contagion from FTX, but my hope is that [everything moves] through the system in the next couple of months, or quarters at most,” Armstrong told Axios in an interview, comparing the panic caused by FTX’s meltdown to the collapse of bitcoin exchange Mt. Gox in 2014. “After 18 months people moved on and nobody asked me about it after that.”
The fallout from the shock FTX implosion last month has already plunged some of the world’s biggest crypto companies into crisis, with fears still swirling that other major companies and cryptocurrencies are teetering on the brink of collapse.
Crypto lender BlockFi followed FTX into bankruptcy last month, raising questions over how many other crypto companies could suffer from FTX contagion. Earlier this year, the sudden meltdown of the terraUSD so-called algorithmic stablecoin and its support coin luna wiped out crypto hedge fund Three Arrows Capital as well as crypto lenders Voyager and Celsius
The Coinbase share price has fallen along with the bitcoin, ethereum and crypto market this year, crashing by almost 90% over the course of 2023 as traders abandon crypto trading platforms, though Armstrong remains upbeat.
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“The bull case for Coinbase is we’re the leader in the market from a trust point of view and the largest [exchange] in the U.S.,” Armstrong said. “The market is giving us very clear feedback that they want to work with trusted companies if they’re going to be centralized actors.”
This year’s “cryptopocalypse” and “inflationary pressures” were named as two of the biggest trends of 2022 by a survey of restructuring professionals polled by Petition.
Inflation, which has rocketed to 40-year highs this year, has forced the Federal Reserve into a brutal series of interest rate hikes this year, pushing down prices across the board—and potentially into 2023.