Risk Insights
January has been another eventful month. After a spike in Treasury yields triggered a slump, Bitcoin rebounded strongly. It climbed past $100,000 on January 15, as anticipation around President Trump’s inauguration bolstered sentiment. Investors didn’t have to wait long, with the SEC and Trump administration establishing crypto working groups a week later “to make America the world capital in crypto."
Accordingly, weighted overall risk across centralized exchanges improved during the month, led by notable increases in credit quality at Coinbase, Gate.io, and Bitstamp. All three benefited from increased trading volumes, and Coinbase’s share price jumped +17% during the month.
Conversely, the biggest negative event was Phemex's $85 million loss from a January 23 hack, which precipitated a halt in withdrawals. Agio Ratings has not classified this as a default, since the halt was temporary and there were no associated court filings. Nevertheless, Phemex’s most recent default rating is now x1.2 riskier than it was earlier in January.
Risk Snapshot
Announcement: Agio Ratings Now Powering Exchange Default Insurance
Relm Insurance - a pioneer operating across the crypto, AI and space sectors - has announced its use of Agio Ratings to support underwriting for its latest product. The company's FALTAWEB3 policy is designed help asset managers, broker/dealers and custodians give their customers peace of mind in the event that they are unable to withdraw funds from exchanges due to a default.
Learn more about Relm's FALTAWEB3 product >
Open Roles in Our Network
Credit Risk Associate - DRW, London
Risk News Roundup
A Lingering Question at Coinbase: Who Really Owns the Customers' Crypto? (Wall Street Journal)
KuCoin Pleads Guilty in Crypto Case, Agrees to Pay $300 Million (Bloomberg)
Crypto Exchanges Bitstamp, Crypto.com Suspend Some Stablecoin Services to Meet MiCA (Coindesk)
Canadian Federal Regulator Unveils Rules for Banks to Manage Cryptocurrency Exposure (The Globe and Mail)
About Agio Ratings
Agio Ratings is your trusted source of credit insights for the digital asset market. We serve market makers, funds, regulators, banks and insurers. Our expert team of credit analysts, statisticians and data scientists collect observable data to produce probabilities of default for 45+ exchanges. We also monitor shifts in short-term risk indicators for more than 80 market participants.
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