$248M Stablecoins Flows Out Of Coinbase Amid Rumors Of Liquidity Problems

But rumors that Coinbase is having liquidity problems are growing hotter as a large number of stablecoins are leaving the exchange. However, a part of users in the community still defended this exchange.

Rumors surfaced Friday night that Coinbase could face liquidity issues following leaked emails stating that it would suspend its affiliate program. Business Insider reported that they received emails stating:

“This has not been an easy decision, nor was it made lightly, but, due to crypto market conditions and the outlook for the remainder of 2022, Coinbase is unable to continue supporting incentivized traffic to its platform.”

Some took to Twitter to claim the decision was indicative of liquidity problems for the top US exchange. Kurt Wuckert Jr of CoinGeek tweeted that the suspension of the affiliate program, in combination with other decisions made by this company over the past several weeks, signifies a “liquidity crisis” is looming.

Coinbase outflows

On July 15, around 50% of stablecoins on Coinbase Pro left the exchange, according to on-chain data from CryptoQuant; the total value came to approximately $248 million. The percentage stablecoin outflow was significantly higher on this exchange than on other exchanges such as Binance. Only around 1% of stablecoin reserves left Binance over the same period, but the tokens had a similar value at just under $300 million.

Amid rumors of a crisis at this exchange, several industry professionals have called out those suggesting the exchange is in trouble. Kraken’s Dan Held tweeted, while the developer responsible for the Coinbase affiliate program, NJ Skobene, confirmed the program’s removal was not a warning sign.

DISCLAIMER: The Information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.

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