Coinbase CEO Brian Armstrong foresees the ongoing crypto winter crossing over into 2023 as fears of a further meltdown by markets across the board surge.
Speaking to CNBC on Tuesday, the crypto billionaire revealed that he expected cryptocurrency prices to stay suppressed for a little longer before the market can make a turnaround. “We all hope it will be 12-18 months and nice recovery, but you obviously have to plan for being longer than that and so that’s how we think about it,” said Armstrong.
He noted that as a company, they were well positioned to weather the bear storm, adding he was not bothered by the ongoing disquiets whatsoever. “Obviously we are in a little bit of a down cycle here, but it’s not unusual for us. We have been through four cycles like this. As a company, we’re only 10 years old,” he added.
Asked whether he felt the ongoing inflation, recession fears, and the Fed’s aggressive policies on inflation were the real cause of the continued market sell-off, he replied;
“Actually, it feels the same…when crypto goes down, everyone gets very pessimistic, and others fear [or] get distracted. They move on to other things, and when crypto is running up, they think it’s everything, and there’s a rational exuberance, and so neither one is true. We have this saying internally…it’s never as good as it seems it’s never as bad as it seems.”
After tapping $68,000 in November, Bitcoin embarked on a brutal sell-off, tagging along with Ethereum and other cryptocurrencies, with the Global cryptocurrency market Cap dropping below $1.2 trillion. Crypto lending firms, exchanges, and some DeFi protocols also found themselves in the crosshairs after the May Terra-induced stablecoin storm tore down their liquidity reserves.
Coinbase also saw its revenue drop by nearly 64% as investors took a risk-off amidst the sell-off. “COIN”, its Nasdaq listed stock, also took a hit, plunging by over 80% since November 8, with its cryptocurrency assets losing over 40% of their value between the end of March and June.
Although Armstrong insisted that Coinbase had been so successful over the last ten years, the current bear cycle had made the top executive rethink the company’s future sources of revenue. “We are shifting more of our revenue over time from trading fees to what we call subscription fees and services,” he said, adding that the company was also investing heavily in Web 3.