Coinbase Users Sell $4.7B USDC After Kraken Staking Shutdown

Coinbase users liquidated over $4.7 billion worth of USDC in the last 24 hours.
The massive burning happened after news broke about Kraken shutting down its staking program.
Brian Armstrong warns this may be the first of the many crypto staking shutdowns across US-based platforms.

Coinbase users burned over $4.7 billion worth of Circle USD (USDC) in the last 24 hours. This was according to data gathered by blockchain analytics platform PeckShield from Ethereum transactions.

In other words, the above-mentioned amount of USDC in question was converted into fiat money, therefore being erased from the USDC circulating supply.

The USDC liquidation happened after US-based crypto exchange Kraken shut down its crypto staking program. For those who were previously uninitiated, the US Securities and Exchange Commission (SEC) ordered Kraken to stop offering staking services, to which the latter complied.

SEC chair Gary Gensler claimed the move was to protect hundreds of millions of Americans from risks associated with crypto, which the watchdog bills as securities.

As an aftershock, many people from the crypto industry spoke out, including Coinbase CEO Brian Armstrong and SEC Commissioner Hester Peirce. According to Peirce, SEC’s move was neither fair nor efficient.

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Meanwhile, Armstrong warned that they have been hearing rumors that the SEC is going to target crypto staking for all US customers. If so, then Kraken is only the first of the many staking closures across all US-based crypto trading and staking platforms.

In other news, the US Congress has officially ordered the SEC to hand over documents detailing Gensler’s interactions with FTX former CEO Sam Bankman-Fried. This effectively begins the probe on SEC talks with FTX dating to at least November 2022 during the controversial demise of FTX.

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Jesus Dawal

Jesus Dawal Jr covers news related to the crypto space in Asia and in Australia, although he follows the latest events in the US and Europe as well. He is most interested in the blockchain gaming and regulation aspects of the industry.