- The exchange is also reportedly engaging market makers for alternative channels abroad.
- Three crypto banks, Silvergate, SVB, and Signature, closed in the US last week, amid regulatory pressure.
US cryptocurrency exchange Coinbase has reportedly contacted its institutional clients about plans to set up a new crypto-trading platform overseas as the US regulators continue to rein in digital assets.
According to information from Bloomberg, the exchange also engages market makers and investment companies about possibly creating alternative venues besides the Coinbase marketplace for global clients. Although the publicly listed crypto exchange serves over 100 countries, all orders pass through a centralized marketplace.
The plans, which were shared on the condition of anonymity, did not disclose the location Coinbase would be setting up its operations overseas. But according to recent comments by the company, the European market could be one of the options.
On an earnings call last month, Emilie Choi, the chief operations officer at Coinbase, said that: “international expansion is going to continue to be a very core part of how we operate,” adding that the exchange was encouraged by the regulatory developments in the European Union and the UK, and will continue to invest in the region.
A Growing Exodus By US Crypto Firms Overseas
There is a growing trend of cryptocurrency firms moving abroad to locations considered crypto-friendly – including Hong Kong, Dubai, and Europe – due to favorable tax regimes and regulatory clarity, which industry experts said was lacking in the US.
Last week, Washington’s increasing clampdown on cryptocurrency since the collapse of FTX, saw two banks considered crypto-friendly, Silicon Valley Bank and Signature, taken over by the regulators.
See Related: Signature Bank Closed By New York Regulators; Another Big Blow to Crypto Investors
“Disappointingly, we are not seeing regulators necessarily welcoming transparency and public participation in their rule–marking,” Coinbase executives expressed concerns in the fourth-quarter investor letter, adding that “the United States agencies, in particular, are demonstrating a disjointed stance regarding crypto that is pushing the industry overseas.”
The exchange profits have also declined, thanks to a bear market, which pushed its investors away from risk assets, mainly from the retail segment. Coinbase’s revenue in the last quarter dropped to $629 million from $2.5 billion the previous year, while its Nasdaq-traded stock is down 80% from its ATH.
