Binance CEO Changpeng Zhao on Tuesday triggered a controversy by raising concerns over the financial health of Coinbase and Grayscale (GBTC). Later he deleted the tweet.
While Grayscale, the biggest bitcoin trust and crypto asset management company, dismissed the concerns of CZ as unwarranted, Coinbase, the partner exchange holding its bitcoin reserves, reacted harshly.
“Just stating ‘news reports,’ not making any claims,” the Binance CEO scribbled in the now-deleted tweet.
In the tweet, Zhao raised some numbers. In case, they are true then Grayscale and Coinbase’s market position can face some stress, he tweeted.
In a strong reaction, Coinbase CEO Brian Armstrong responded on Twitter: “If you see FUD out there – remember, our financials are public (we’re a public company).” The FUD in crypto parlance stands for fear, uncertainty, and doubt. Unlike Coinbase, Binance is a privately held company and will not disclose financial information.
According to Coinbase CEO, as of September 30, 2022, his company holds 2 million bitcoin worth $39.9 billion.
Deleting his original tweet within minutes, CZ added: “Brian Armstrong just told me “the numbers are wrong.” He also added: “Let’s work together to improve transparency in the industry.”
However, bonds issued by Coinbase (COIN) slumped indicating falling investor confidence in the industry in the wake of FTX fiasco.
The Coinbase bond due for 2031 dropped 15% in November to 50 US cents on the dollar, per Finra-Morningstar. In bonds, yields will move in the opposite direction to price and Coinbase bond hit a record high of 13.5%.
The Coinbase bond crash has happened after three months of consolidation. Also, the yield on the company’s bond due in 2026 surged 17%.
