Seriously chill – Coinbase is not going bankrupt this crash, you’re not going to lose your coins

There’s a run on Coinbase. Hysteria in r/Coinbase, you’d think there’s blood running in the streets.

As I myself can attest, many people are unable to get their USD or coins out of Coinbase. Mysterious error messages happen if you try. (I can put money in and buy though.)

Why? This is speculation but you know it’s true: a classic bank run. All the hysteria and FUD on Reddit is contributing.

It happens every crash like clockwork.

Coinbase simply doesn’t have the cash to cover the run. Like all CEXes including Kraken and Binance, they’re fractionally reserved. The balances shown are not actually on any blockchain or cash vault – until you withdraw or transfer. (In fact it’s very possible that once the last BTC is mined or close to it, that someday CEXes will sell more BTC combined than actually exists.)

There’s nothing inherently wrong with that. Nowadays banks can get away without any reserves. But the FUD on Reddit is not helping, so blame your fellow Redditors. I’m not saying I like it, but it is the way the world works for now. And in a world economic system that falls apart if constant exponential growth is not maintained, what else do you expect? Don’t like it? Vote for people who promise to change that fundamentally flawed system.

Either way, Coinbase is not going bankrupt anytime soon, certainly not this crash. Relax. They’ll be back online. I’m not happy about it either, but take a frickin chill pill already.

Each time this happens, it seems they get better at covering runs. Maybe they increase their reserve policies each time, who knows. Either way, you’ll get your coins. Sucks now, no doubt, but you aren’t going to lose your money. Not this time.