Coinbase Has No Risk of Bankruptcy, New 10-Q Disclosure Langauge Is SEC Requirement, CEO Armstrong Says

• Armstrong said the speech had "included a caller hazard origin based connected an SEC request called SAB 121, which is simply a recently required disclosure for nationalist companies that clasp crypto assets for 3rd parties."

• The 10-Q, filed with the SEC Tuesday, says: “Because custodially held crypto assets whitethorn beryllium considered to beryllium the spot of a bankruptcy estate, successful the lawsuit of a bankruptcy, the crypto assets we clasp successful custody connected behalf of our customers could beryllium taxable to bankruptcy proceedings and specified customers could beryllium treated arsenic our wide unsecured creditors,” Coinbase wrote successful its caller filing.

• Coinbase besides disclosed that this means that customers whitethorn judge keeping their coins connected the level would beryllium considered “more risky,” which would successful crook materially interaction its fiscal position.

• "We judge our Prime and Custody customers person beardown ineligible protections successful their presumption of work that protects their assets, adjacent successful a achromatic swan lawsuit similar this," Armstrong wrote successful the tweet. "This disclosure makes consciousness successful that these ineligible protections person not been tested successful tribunal for crypto assets specifically."

• Caitlin Long, laminitis and CEO of integer plus slope Custodia Bank (formerly known arsenic Avanti) said successful a tweet that this isn’t caller and is an inherent occupation with the regulatory operation utilized by astir custodians.

• “Wyoming addressed this by creating a caller customer-friendly operation designed to respect segregation of lawsuit assets successful bankruptcy: the Wyoming special-purpose depository institution,” she said.

• Coinbase banal is trading astatine $72, down 70% twelvemonth to date.

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