The bitcoin price has lost over 10% while the ethereum price is faring even worse—partly due to investors betting some smaller cryptocurrencies could supplant ethereum.
Now, as crypto traders scramble to get ahead of a looming “hundred-pound gorilla,” the chief executive of major crypto exchange Coinbase
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“I can’t tell you what the world’s going to be like a year from now,” Coinbase CEO Brian Armstrong told CNBC, warning crypto exchange fees will shrink, putting pressure on Coinbase’s bottom line as an exchange fee war that began earlier this year ramps up.
“I do think there’s going to be margin compression, eventually it has to happen at some point because everything that we’re building, you know, others, eventually you’re going to build it and it’ll become a little bit more commoditized.”
Coinbase, perhaps the world’s most important crypto on-ramp for new users, has struggled since making its Nasdaq debut last year near the top of the bitcoin, ethereum and crypto price bull run. Coinbase shares are down around 80% from their all-time high as trading volumes slump along with the bitcoin price despite signing a potentially massive $10 trillion crypto game-changer earlier this month.
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However, Armstrong, who founded Coinbase in 2012, remains upbeat, arguing the company has weathered similar crypto price downturns in the past.
“We have this saying internally, I like to repeat a lot, which is you know, it’s never as good as it seems, it’s never as bad as it seems,” he said. “I think one of the reasons Coinbase has been so successful in the last 10 years is we just we try not to get focused on short-term ups and downs.”
Other bitcoin and crypto market watchers are though finding it hard to remain optimistic, with one analyst pointing to a sentiment slump.
“With treasury yields rising again, sentiment worsening, prospects of further declines in equities and still a high correlation between crypto and the general market, it is hard to be optimistic,” Rafal Tworkowski, a market analyst at currency trading platform Conotoxia, said in emailed comments.