Black Swan Author Nassim Taleb says Crypto Exchange, Coinbase is ‘Worthless’

Black Swan Author Nassim Taleb next to a portrait of a Brian Amstrong inside a Coinbase logo

Acclaimed options trader and Lebanese-American author Nassim Nicholas Taleb has taken a swipe at Coinbase and has called the Nasdaq-quoted cryptocurrency exchange (COIN) “worthless.”

Black Swan Author Calls Coinbase Worthless

Despite showing love for cryptocurrency, Nassim Nicholas Taleb has been a major critic of the biggest U.S.-based crypto exchange Coinbase, closing his accounts with the company in June 2020.

In a Twitter thread, the Black Swan author explained that Coinbase has negative cash flow, meaning it has more outgoing than incoming money. He adds that it’s a “grisly” future even if the crypto industry manages to recover.

Taleb called Coinbase worthless while pointing out that its owners have been getting out. Despite the grim outlook, he noted that he does not believe Coinbase will face the same fate as FTX. He tweeted:

Is Coinbase in Trouble?

Last week, we reported that Coinbase’s stock fell to an all-time low after investors’ faith in centralized exchanges was dented by the FTX collapse. However, the company’s issues may run even deeper, as its fee revenue declines.

Coinbase’s business model is the major source of the company’s problem, with its fees around the highest in the market. The high fees have kept many users away from Coinbase, with Binance benefiting more from the FTX crash.

On the Flipside

  • Coinbase has launched an initiative to help encourage more transparency among firms in the industry, along with a $500,000 developer grant program.

Why You Should Care

With decreased cash inflow into the industry and its high fees, Coinbase would need to restructure its business model to circumvent its financial crisis.

This article is for information purposes only and should not be considered trading or investment advice. Nothing herein shall be construed as financial, legal, or tax advice. Trading forex, cryptocurrencies, and CFDs pose a considerable risk of loss.

Author
Milko Trajcevski

Milko Trajcevski is a DailyCoin news reporter, mainly focused on Ethereum (ETH), Cardano (ADA), and their founders (Vitalik Buterin and Charles Hoskinson). Milko is an avid follower of crypto and blockchain technology and has written thousands of articles on the subjects. He finds joy in transforming complex issues into written content that anyone can understand. Milko has used and analyzed numerous exchanges, such as Coinbase, FTX, and Binance. He also closely follows all of the latest news around the largest decentralized exchanges (DEXs). Location: Skopje, Macedonia