Since alle X-Accounts are stuck in USDC, please explain for all how safe are our funds in X-Accounts in case of Coinbase bankruptcy?
"Coinbase Says Users’ Crypto Assets Lack Bankruptcy Protections
Cryptocurrency trading firm warns its customers could be viewed as general unsecured creditors
Coinbase acknowledged that reality this week. In its quarterly filings, the crypto trading firm suggested that the digital tokens it holds for its users might not really belong to them if push comes to shove.
“Because custodially held crypto assets may be considered to be the property of a bankruptcy estate, in the event of a bankruptcy, the crypto assets we hold in custody on behalf of our customers could be subject to bankruptcy proceedings, and such customers could be treated as our general unsecured creditors,” the company said.
By contrast, securities held for customers by a registered brokerage are legally segregated from the assets of the brokerage, meaning they can’t be touched in bankruptcy proceedings. The Securities Investor Protection Corp., a nonprofit entity set up by Congress in 1970, also insures as much as $500,000 of customers’ securities and cash in brokerage accounts."
Copied from The Wallstreet Journal (wsj_dot_com)