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Coinbase, the largest cryptocurrency exchange based in the US, has suffered a serious blow in recent times due to a lawsuit filed by the US Securities and Exchange Commission (SEC). In a new shareholder letter, Coinbase reported a $53 billion decrease in individual and institutional trading volume in the second quarter of 2023.
Impact of SEC on the Major Exchange
The US Securities and Exchange Commission (SEC) filed a lawsuit against Coinbase, the US-based cryptocurrency exchange, in June for violating securities laws. The tension between crypto companies and financial regulatory authorities escalated further with SEC’s lawsuit against Binance in June.
Coinbase, the largest cryptocurrency exchange based in the US, suffered a significant blow following the lawsuit by the SEC. Speculations were made in the markets that the company could relocate its headquarters to a country other than the US, but Coinbase’s CEO Brian Armstrong denied these claims and stated that the possibility of the company leaving the US does not exist at the moment.
However, Coinbase, which was significantly affected by the lawsuit, experienced striking decreases in trading volumes. The exchange recorded a $53 billion decrease in trading volume in the second quarter of 2023 compared to the first quarter.
$53 Billion Decrease in Trading Volume
Coinbase, the largest US-based cryptocurrency exchange, experienced a $53 billion decrease in institutional trading volume in the second quarter of 2023 compared to the first quarter. The exchange recorded a trading volume of $145 billion in the first quarter and $92 billion in the second quarter. The trading volume recorded in the second quarter of 2022 at Coinbase was over $200 billion.
Coinbase exchange, which continues to experience a rapid decline in trading volume after the lawsuit filed by the SEC, has applied to the court for the dismissal of the lawsuit. There have been no critical developments that have influenced the course of the lawsuit yet following Coinbase’s objection. Paul Grewal, the Chief Legal Officer of Coinbase, stated that they believe they can win the lawsuit in their various statements regarding the matter.
