S&P Global downgrades Coinbase's long-term credit rating – Bits Media

According to the credit rating agency S&P Global, The rating of the American cryptocurrency exchange Coinbase will continue to fall along with the deteriorating situation in the cryptocurrency market.

S&P Global published a note, which outlined the forecast for one of the largest cryptocurrency exchanges Coinbase. It turned out to be negative - the agency downgraded the exchange’s long-term credit rating and the rating of senior unsecured debt from “BB+” to “BB”, citing weak earnings and competitive pressure.

“Competitive risk in the crypto exchange sector has increased, and this year the company's market share has decreased. We count, resulting in erosion of market share and higher risk of margin compression, Cyclical fluctuations for Coinbase exceeded our previous expectations, which forced us to reconsider our financial risk assessments.”, – writes S&P Global.

The agency stated, that its assessment also reflects uncertainty regarding the duration of the current recession in the cryptocurrency market and the potential for further deterioration in market share. Coinbase shares closed Thursday at $84 for pike, having dropped by more than 10%. Last fall, the company's shares peaked at more than $350 for pike.

Coinbase previously reported a decrease in trading volume from $309 million in the first three months of this year before $217 million in the second quarter, as well as discrepancies with expected income. The exchange reported a net loss of $1.1 billion during the second quarter compared to a loss of $430 Milln in the first quarter.

Recall, that this week the US Securities and Exchange Commission (SEC) through the court, requested information about the placement of crypto assets and the company’s own profitable products.