Archives February 2022

The largest cryptocurrency exchange in America,, has warned users to be cautious of scams that may accompany its ongoing giveaway, which was recently advertised in an advertisement.

Coinbase warns users about scam

Coinbase wanted to attract new people to the emerging crypto industry and offered $15 to anyone who signed up using the QR code it displayed during the Super Bowl.

Security is super important to us.

The only way to be eligible for our $15 BTC giveaway is to sign up for a Coinbase account by following this link – https://t.co/fKHisXZJJc

It could have been a fraud if it wasn’t from us.

– Coinbase (@coinbase February 14, 2022

This warning is vital because it warns that bad actors may use the ad to create nefarious plans to rob unsuspecting people of their money.

Similar scams have occurred when these con artists took advantage of major events.

Scammers used Elon Musk’s Saturday Night Live appearance to scam more than $10 million in Bitcoin and viewers.

Coinbase is warning because the Super Bowl attracts a large viewership (estimated at 100 million), so the ad may be seen by many people.

Already there are signs that the ad had an enormous effect as the traffic spike on Coinbase platforms caused temporary downtime.

Crypto Ads Dominate Super Bowl

Many crypto-related ads were displayed during the highly anticipated Super Bowl match between Los Angeles Rams and Cincinnati Bengals. Their main purpose was to attract more investors to the emerging industry.

Advertisements featuring crypto themes were created for firms such as FTX and eToro.

Regulators Draw a Line on Crypto Ads

Regulators around the world are becoming increasingly concerned about crypto ads. Regulators tend to say that most crypto-related ads fail to highlight the risks associated with the asset class.

In an effort to limit the types of ads their citizens are exposed too, Singapore, Spain and Britain have, among other things, launched many crypto ads regulations.

As regulators continue to be attracted to crypto spag it means that many crypto ads will change the tone and language from what we already know.

MicroStrategy took a $146.6million impairment charge for its bitcoin holdings in the fourth quarter 2021. This was six times higher than the same period last years, resulting in a net loss.

Based on the most recent earnings statement Tuesday, this loss contributed to the company’s operating expenses which rose by 125% to $248m in the fourth quarter.

A firm’s impairment charge is a decrease in the carrying value for a particular asset.

MicroStrategy’s non-cash impairment charge for digital assets reflected the decline in bitcoin’s price relative to when it was bought. According to applicable accounting principles, an asset’s purchase price can be reduced if its value drops below the amount it was purchased. This is a common practice that applies only to high-cost assets.

The Tysons Corner, Virginia-based company saw digital asset impairment losses of $831 million for the year compared to $71 millions in 2020.

Since August 2020, when the firm acquired bitcoins, it has suffered around $901 million in impairments.

MicroStrategy reported December 31 that had 124,391 Bitcoin at an aggregate cost $3.8 billion and a value $2.9 billion.

The 660 bitcoins that MicroStrategy bought Tuesday for $25 million in cash, at an average price $37.865 per coin, are not included. MicroStrategy currently holds 125,051 Bitcoins.

Bloomberg data shows that MicroStrategy took impairment charges in six quarters starting from the time it acquired bitcoin. The firm was unprofitable in five quarters. The firm was profitable in eight of the nine quarters before adding bitcoin to its balance sheets.

In January, Bitcoin had its worst month since its 2018 cryptocurrency winter. The asset traded at $38,000 and lost 18% in January, well below its November 2021 all-time high of $69,000.

The Securities and Exchange Commission recently asked MicroStrategy to review its crypto accounting methods. This means that MicroStrategy cannot strip bitcoin’s price swings out of its non-GAAP accounting measures presented to investors.

Phong Le, MicroStrategy’s Chief Financial Officer, stated during the Tuesday earnings conference that he agreed with the agency’s ‘that on an going-forward basis any non-GAAP financial measure we may present in the future filings should maintain the impact of bitcoin impairment losses.

He stated that MicroStrategy’s non GAAP financial measures have not been changed in its strategy, operations, GAAP financial statements or SEC filings.

“Our noncash bitcoin impairment fees will continue to be subject to market volatility bitcoin prices,” Le stated. We will again recognize impairment charges in the first quarter 2022 due to the significant fall in bitcoin’s market price in January 2022.