Again, cryptocurrency users and industry experts are sensing troubles ahead for the leading US exchange Coinbase, following recently leaked information that the company has decided to stop its affiliate program in the United States temporarily.
It’s no longer news that Coinbase has been facing headwinds with its global operations amid the bear market. However, the recent reports in the past weeks somehow convey that situation could be so serious than imagined. These are worrying times for Coinbase and cryptocurrency users.
Coinbase is shutting down its affiliate program
According to emails leaked to Bussiness Insider, Coinbase intends to temporarily suspend the US affiliate marketing programs starting July 19th. Before this update, some of the promoters claimed that the company slashed the commission bonus by a wide margin – up to 90%, according to one creator.
“This has not been an easy decision, nor was it made lightly, but, due to crypto market conditions and the outlook for the remainder of 2022, Coinbase is unable to continue supporting incentivized traffic to its platform,” Coinbase.
Meanwhile, the exchange did mention that the program would be resumed in the coming year (2023) but failed to state the exact date.
Experts issue red flags
Experts perceive the report as a red flag on Coinbase, with some warning that users to pull out their cryptocurrency from the exchange, saying the exchange could be headed for a liquidity crisis.
Ben Armstrong (BigBoy Crypto) believes that the chances of Coinbase going bankrupt is very slim but not impossible. Should Coinbase file for bankruptcy, “this would break crypto the crypto space like we have never seen before,” he added.
A rocky road for Coinbase
The price of Coinbase stock (COIN) is presently down over 78.57% on Nasdaq year-to-date. Last month, the company laid off about 18% or over 1,000 of its employees amid the strain of the bear market.
More recently, Cryptopolitan reported that the exchange’s average trading volume has tanked by over 82% from the peak in November 2021 – $7 billion to $1.2 billion. Also, the exchange has fallen from the fourth largest by trading volume to the 14th-largest, according to Dan Dolev, an equity research analyst at Mizuho.