The bitcoin and cryptocurrency market has lost about $ 400 billion since its peak last weekend as panic spreads among traders.
The price of bitcoin, after reaching a tactile distance of $ 60,000 per bitcoin last week, has fallen nearly 25%, down from $ 43,000 (although bitcoin continues to rise nearly 50% since beginning of 2021).
Now, documents released by Coinbase cryptocurrency exchange ahead of its expected initial public offering (IPO) have revealed possible events it fears could destabilize the price of bitcoin and etherum, which could undermine its business.
Coinbase, a San Francisco-based exchange of bitcoins and cryptocurrencies, has been introduced to make it public … [+]
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Coinbase has released documents for its public debut on the Nasdaq Stock Exchange using a direct listing (meaning it will not try to raise more money), with a fledgling bitcoin and cryptocurrency company valued at more than $ 100 billion.
As part of its IPO preparations, Coinbase established a number of factors that could affect the price of the two largest cryptocurrencies, bitcoin and ethereum, which drive 56% of the total trading volume on the stock exchange and provide Coinbase most of its revenue through transfer fees.
These risk factors include disruptions, piracy, splits in the underlying network also known as “forks,” as well as developments in quantum computing and regulation that affect cryptocurrencies.
“The development and future growth of cryptography is subject to several factors that are difficult to predict and evaluate,” the documentation said.
It should be noted that the presentation also cited “the identification of Satoshi Nakamoto, the pseudonymous person or persons who developed bitcoin,” as a potential risk factor, as well as the transfer of Nakamoto’s bitcoins, which are believed to be worth about $ 30 billion. dollars. Some fear that if Nakamoto is identified or introduced, it could damage the decentralized nature and reputation of Bitcoin.
Nakamoto’s identity has been the subject of fierce media scrutiny, as several investigations have failed to unmask the mysterious bitcoin developer. In 2016, Australian businessman Craig Wright claimed to be Nakamoto, but was unable to provide evidence and has since been waging an increasingly desperate legal war to be recognized as the creator of Bitcoin, alienating much of the Bitcoin community. bitcoins and cryptocurrencies.
The price of bitcoin has dropped dramatically over the past week, from nearly $ 60,000 per bitcoin to … [+]
Coinbase
Bitcoin is known for its extreme volatility. In late 2017, the price of bitcoin rose to about $ 20,000 before falling to $ 3,000 in 2018. Last year, the price of bitcoin dropped from $ 4,000 in March before recovering over the summer. It began its last bullish run in October, surpassing the 2017 high in December, as institutional investors showed renewed interest in digital assets.
Last week, the combined value of the 18.6 million bitcoin tokens in circulation reached $ 1 trillion for the first time, double the $ 500 billion it began in 2021 as the craze for cryptocurrencies returned to vigor.
“You can expect volatility in our financing, given the price cycles of the cryptocurrency industry,” Coinbase CEO Brian Armstrong wrote this week in a letter alongside the company’s filing documents. “This doesn’t baffle us, because we’ve always taken a long-term perspective on the adoption of cryptography.”