I think it also has to do with Coinbase fractional reserving bitcoin in a similar to what FTX was doing last cycle before binance blew up that Ponzi scheme.

Despite what we know in hindsight, FTX had legitimate financing partners and had the appearance of having it all together. They looked “legit” much in the same way Coinbase looks “legit” … what was the action that the US government was taking against Coinbase that suddenly went away? Then they got the custody contract for most of the ETF volume.