Coinbase Shuts Down Its Borrowing and Lending Division
Earn Your First Bitcoin Sign up and get $12 Bonus Referral bonus up to $3,000
Coinbase Borrow – the official lending protocol of Coinbase, one of America’s largest and most popular digital currency trading platforms – has ceased all operations.
Coinbase Borrow Closes Its Doors Permanently
The end for Coinbase Borrow arrived on May 10. This was the last day on which customers could take out loans. Those who received loans prior to the set date were told their financials wouldn’t be affected. This was simply the cut-off date for all new lending customers.
At the time of writing, despite the exchange being under heavy scrutiny from institutions like the Securities and Exchange Commission (SEC), the closing of Coinbase Borrow doesn’t appear to have anything to do with the company’s ongoing legal problems. A person allegedly familiar with the matter explained in a statement:
We regularly evaluate our products to ensure we’re prioritizing the offerings that our customers care about most. Effective May 10, we will stop issuing new loans through Coinbase Borrow. There is no impact on customers’ outstanding loans, and no action is required from them [currently].
Right now, many analysts are being forced to come up with their own conclusions and assumptions regarding the reasons for the closure. One can say, for example, that the borrowing and lending arena in the crypto world has been rather up and down over the past year, and thus Coinbase doesn’t want to take any chances.
For example, lending protocols such as Celsius and Voyager Digital have been forced to close their doors and enter bankruptcy proceedings as a means of protecting themselves against angry creditors who want their money back. These institutions also halted all withdrawals, thus cutting customers off from their hard-earned funds to ensure that they could at least remain relatively stable while they figured out their next steps.
The crypto industry is still reeling from the actions of 2022. While assets like bitcoin have experienced some degrees of healing since the start of 2023, there is still a lot of work to do, and a black cloud is still hanging over the heads of many crypto and blockchain institutions. It may be some time before everything is fully resolved.
Coinbase has been enduring several issues over the past few months. Not long ago, the company received a Wells notice from the SEC, informing executives that while charges hadn’t been filed against the company yet, these charges were likely to arrive relatively soon.
Why Send Us This?
Coinbase took serious issue with the Wells notice on account of the alleged fact that those in charge met with representatives of the SEC roughly 30 times over the course of nine years to ensure that they remained fully compliant with present securities and financial laws.
The SEC has arguably become one of the biggest crypto bullies around.
Source: Read Full Article
