Crypto exchange Coinbase denies risks for customers in case of bankruptcy

Last month, there was a lot of discussion on the Internet that in the event of a bankruptcy, Coinbase would use its customers' assets to pay off debts to investors and creditors. In response, the company’s general counsel, Paul Grewal, made a number of statements to reassure the audience.

Grewal argues that the platform does not lend against client assets, as is customary in the traditional banking model, which is why a potential liquidity crisis could occur. «Coinbase always keeps customer assets in a 1:1 ratio,» Grewal said. «This means that funds are available to our clients 24 hours a day, 7 days a week, 365 days a year.»

The lawyer also added that the agreement with ordinary users has been updated and now clearly states that customer assets cannot be used to repay the company’s credit obligations as it was before.