Coinbase to Delist 80 non-USD Trading Pairs – What’s Going On?

Digital asset exchange Coinbase has announced a suspension on 80 non-USD trading pairs in a bid to boost liquidity on its platform.

In an Oct 17 press release, the exchange disclosed plans to delist the pairs, including assets with market leader Bitcoin (BTC), Tether (USDT), and the Euro citing efforts to improve market health and liquidity.

The company stated that the decision follows previous efforts to monitor markets, hence a suspension on the exchange, Advance Trade, and Coinbase Prime.

“As previously announced, we have suspended trading on a number of non-USD markets across Coinbase Exchange, Advanced Trade, and Coinbase Prime.”

However, users affected by the suspension on the platforms mentioned above in eligible regions can still access the trading pairs through its more liquid USD order books through the exchanges’ USDC balances. 

Alternatively, affected users continue trading these pairs with USD unification using their “USDC balances to trade in both USD or USDC order books.” 

The company announced the USDC unification in April allowing users to utilize their USDC balance to trade on USD books.

“The new USD<>USDC experience on Coinbase Exchange is here. We’ve added settlement preferences, so Exchange users can use their USDC balance to trade on our USD books. This makes USDC an even more seamless and easy way to deposit, withdraw, and trade 24/7.” 

The 80 non-USD markets make up an immaterial amount of the platform’s global trading volumes, the company revealed.

Centralized exchange volume plummets 

Centralized exchanges (CEX) are the most popular types of crypto exchanges because of their high liquidity and increasing markets, although criticized for their nature with similarities with financial intermediaries in traditional finance.

However, the majority of crypto trades take place on centralized exchanges with Binance and Coinbase being among the leaders in several jurisdictions.

Coinbase, the largest exchange by volume in the United States, has been on a mission to improve liquidity across its dominant markets, spurring it to delist multiple trading pairs. 

In a similar development in September, the exchange announced a suspension of 41 non-USD trading pairs. Liquidity continues to be a concern as the total volume plummets.

In Q3 2023, Coinbase posted spot trading volumes of $76 billion, a 52% drop from last year’s position and about the lowest since the exchange became publicly listed on Nasdaq. 

Besides liquidity concerns, regulatory issues with the Securities and Exchange Commission (SEC) have weakened investor and user confidence as the firm’s case with the regulator continues. 

In June, the SEC filed lawsuits against Coinbase and Binance for allegedly offering trading services on unregistered securities, improper registrations, and asset commingling, allegations which both exchanges vow to “vigorously defend” themselves against in court.

On the other hand, Binance also suffers a similar fate as its market share has dropped for the seventh consecutive month since it faced global regulatory hurdles.