In November, the price of Coinbase’s stock reached a new all-time-low of $40.61. According to data from CoinGecko, the two biggest cryptocurrencies by market cap, Bitcoin and Ethereum, both declined. Bitcoin fell by 5.5% to $15,665 and Ethereum fell by 8.2% to $1,081 in a single day.
Coinbase has marketed itself as a more reliable and compliant exchange using the demise of FTX, but that hasn’t stopped the stock price slide of the company.
Coinbase also released a statement saying a bank run at its exchange would be impossible because its customer assets are backed 1:1. Additionally, it stated that it had no exposure to the rapidly decreasing FTT token used by FTX. Since there were $15 million in deposits on FTX as of November 8, the exchange did reveal its exposure to Alameda Research.
Despite being one of the biggest and oldest exchanges, Coinbase’s stock has dropped 87% in the last year. Following larger rounds of layoffs earlier this year, it also fired more than 60 workers this month.
The exchange’s struggles in recent months may be an example of the broader “crypto contagion” thesis—which posits that the fall of one company will cause a domino or ripple effect that damages the whole industry.