Why did Coinbase stock slide today? Worries over FTX and USDC

Coinbase Global ( NASDAQ: COIN ) stock tumbled 9.2% in Tuesday trading as worries about FTX continue to spread across the cryptocurrency sector. News absorbed by markets today include Sam Bankman-Fried's arrest on Monday evening and FTX's current CEO, John J. Ray, III, testimony to a House committee disclosing that FTX had "virtually no" internal controls or recordkeeping when it came to how funds were linked across SBF's empire. In addition, the SEC filed a lawsuit against SBF , alleging that he defrauded FTX's investors and customers. Another potential catalyst for Coinbase's ( COIN ) drop is its connection with USD Coin ( OTC:USDC ). Binance suspended withdrawals of USDC for a few hours on Tuesday as that exchange saw ~$1.4B net withdrawals during the session. Coinbase has a stake in USD Coin ( OTC:USDC ) with Circle Internet Financial, and USDC represents an important part of Coinbase's interest income. Since May, SA's Quant system has warned that Coinbase ( COIN ) has a high risk of performing poorly. Last week, Mizuho downgraded Coinbase ( COIN ) to Underperform, questioning the crypto exchange's interest income prospects.