Prices for digital assets were cratering after crypto-lending platform Celsius pauses withdrawals and transfers
Coinbase shares have lost nearly 80% so far this year.
Shares of Coinbase Global Inc. were cratering toward one of their largest drops on record Monday after a different cryptocurrency platform’s decision to pause withdrawals and transfers led to further jitters about the market for digital assets.
Coinbase’s stock COIN, -11.41% was down about 14% in Monday morning trading, after falling as much as 21.6% earlier in the session. The stock was on track for its third largest single-day percentage decline on record as it extended its steep year-to-date decline, with shares off nearly 80% so far in 2022.
Prices for crypto assets were down sharply as well. Bitcoin BTCUSD, -5.76% was falling 14% Monday, ethereum ETHUSD, -5.88% was off 16%, and litecoin LTCUSD, -1.13% was down 15%.
This chart shows how much worse a selloff could get.
The steep stock drops come after crypto lending platform Celsius Networks LLC said Sunday that it would be pausing withdrawals, swaps, and transfers between accounts. The company cited “extreme market conditions” and said in a blog post that the move would “put Celsius in a better position to honor, over time, its withdrawal obligations.”
The moves are taking place in the wake of Consensus, a major cryptocurrency conference that wrapped up Sunday. Christopher Brendler, a D.A. Davidson analyst who covers crypto miners, carried a cautious tone when recapping the event.
“Unfortunately, we came away significantly more bearish (as) the sharp drop in liquidity has stressed even the strongest players,” he wrote. “While larger, public companies are much better positioned and might still take advantage of forced consolidation, the weekend drop in BTC and spike in network hashrate exacerbates what is already a very difficult situation.”