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Crypto values may have been important since the beginning of this year. Coinbase is now the largest U.S. cryptocurrency company, with an estimated valuation of $ 8 billion. The exchange is now engaged in a series of moves to become a mainstream financial services firm. If successful, Coinbase will be uniquely located to influence the future of crypto use and adoption.
Founded in 2012, Coinbase was among the first exchanges that enabled Bitcoin buys from fiat bank accounts. The most recent being 0x (ZRX). In addition to offering retail sales, Coinbase operates CoinbaseProAn exchange that enables peer trading among the currencies listed on CB. Coinbase's successes on a strong reputation of professionalism and reliability. Unlike many exchanages, it operates very transparently, and being U.S. based, Americans perceives it as more trustworthy than foreign competitors.
Most recently, the company has begun to position itself as a bridge between the crypto and fiat spaces. To this end, it is targeting institutional investors, and has begun to work with the financial institutions. For example, it has been introduced to a firm, USDC, which it developed via a partnership with Circle, which is a subsidiary of Goldman Sachs. It also offers Coinbase Custody, a premium service designed to invest and manage crypto investments for large-cap clients. Other financial institutions working with Coinbase include Tiger Global and Barclay's.
There is little doubt that the Coinbase team believes that it will coexist, at least in the near future. This position is not based on blockchain-based assets, but it is certainly good for business. By offering a safe, trusted means by which investors can purchase cryptocurrency, and by associating with established financial institutions, the company is thriving. In fact, it has been confirmed that it is preparing an initial public offering, which will make it to the first cryptocurrency company to go public. As part of this process, the company said it was $ 90 million last quarter, and expects to make an astounding $ 450 million in Q4 2018.
There are, of course, been a few setbacks. Coinbase's reputation for professionalism took over when it was revealed that the number of employees was higher. The company vowed to fire any employee that had done so. It also has a well-publicized fight with the Internal Revenue Service in its attempt to keep customer information out of the hands of the tax agency.
Coinbase 's growth has played a key role in giving credentials to an audience of legitimacy among a public skeptical. Although blockchain assets are well-known, many people remain wary of investing in them. Potential adopters lack the technical skills or consider them too risky. Despite the anti-fiat, and anti-bank positions of crypto purists, companies like Coinbase, which are willing to embrace the traditional financial system, represent a traditional, and thus more trusted, means of entering the crypto space.
It's still far too early in the blockchain to be certain how companies like Coinbase will fare long-term. There are certainly challenges, as it is cryptocurrency is, by its very nature, not designed to be centrally managed. Also, many competitors are emerging both in the United States and abroad. Nevertheless, there is little doubt that this is the case, as well as the need for coinbase to capture public attention, and provide a gateway to crypto adoption.
Featured Image via BigStock.
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