Coinbase Tested Group to Speculate on Crypto: WSJ Report

The Wall Street Journal reported today that Coinbase began establishing an internal cryptocurrency trading desk last year despite prior assurances to Congress that it was not conducting a proprietary trading business. Coinbase Established an Internal Business Division In July 2021, according to the WSJ, Coinbase established an internal business division for cryptocurrency trading and staking. According to the allegation, which relies on unnamed inside sources, the corporation hired experienced Wall Street traders to oversee the initiative to use company assets for cryptocurrency trading activities. Regulators dislike proprietary trading by exchanges because it may be a conflict of interest. Internal trading desks could cause exchanges to trade against the interests of their clients and result in significant client losses. Executives from Coinbase testified before Congress in December to deny operating a proprietary trading firm. Before this, the platform had developed a business division called Coinbase Risk Solutions for trading cryptocurrency on behalf of clients. According to the WSJ, this unit performed a $100 million cryptocurrency transaction in 2022 for a profit. $100 Million Transaction Carried Out By Coinbase After the $100 million transaction concluded, Coinbase gave up trying to establish an internal trading department. According to the WSJ story, several firm employees were no longer enthusiastic about engaging in ...