Coinbase Denies Significant Drop in Bitcoin Liquidity Amid SEC Lawsuit

Coinbase Denies Reports of Significant Bitcoin Order Liquidity Drop Amid SEC Lawsuit

Coinbase, the popular cryptocurrency exchange, has denied reports that its Bitcoin order liquidity dropped significantly during the U.S. Securities and Exchange Commission’s (SEC) lawsuit against market maker Cumberland.

In a statement, a Coinbase spokesperson said, “In October, we did not see a significant change or decline in BTC-USD depth around 2%.”

Crypto data analytics company Kaiko, however, reported that the 2% BTC depth on Coinbase began to decline at 18:00 UTC on October 10, falling by 46% to 267 BTC within a few hours.

2% market depth represents the collection of buy and sell orders within 2% of the mid-price or average bid and ask/offer prices. This metric helps measure liquidity, or the market’s ability to process large trading orders at a stable price while providing market participants with minimal slippage (the difference between the expected price and the price at which the order is executed).

Despite the data from Kaiko, Coinbase maintains that its trading conditions remain stable, dismissing concerns about a decline in Bitcoin order liquidity during the SEC lawsuit against Cumberland.

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