Coinbase CEO calls out “risky business practices” in FTX saga, sympathizes with those involved

Coinbase CEO Brian Armstrong took to Twitter on November 8 to express his “sympathy for everyone involved in the current situation with FTX.” When customer assets are at risk, Armstrong understands how “stressful” it can be.

The Coinbase CEO, on the other hand, made certain that the community understood the distinctions between Coinbase and FTX, stating that Coinbase has no “material exposure” to either FTX or Alameda Research.

Armstrong asserted unequivocally,

“This event appears to be the result of risky business practices, such as conflicts of interest between closely related entities and misappropriation of customer funds (lending user assets).”

In a now-deleted Twitter discussion, FTX CEO Sam Bankman-Fried asserted that customer assets were not at risk. However, following the announcement of a possible Binance takeover, he revealed that FTX had a “backlog” of customer withdrawals that needed to be cleared by Binance.

Coinbase is registered and publicly traded in the United States, according to Armstrong, “because we believe that transparency and trust are so vital.” Furthermore, because Coinbase is a publicly traded firm, it is compelled to provide financial data in compliance with SEC standards, whereas FTX is not.

Armstrong also used the opportunity to criticize additional regulation, which SBF had backed while specifying areas where the crypto business should “compromise.”

Coinbase, according to Armstrong, would continue to “engage with lawmakers to implement sensible legislation for centralized exchanges.” Nonetheless, he stated that he did not believe there was a “even playing field” up to this point.

The CEO of Coinbase also advocated for the expansion of non-custodial options.

“DeFi and self-custodial wallets that do not rely on third-party trust.” Instead, you may put your reliance in code/math, and everything on-chain can be publicly auditable.

Armstrong concluded his Twitter thread by linking to Coinbase's transparency strategy, claiming that Coinbase is “the most trusted crypto company out there.”