Skip to main content

King Coinbase

There have been a lot of winners and a lot more losers in the rise (and fall and rise again and so on and so forth) of cryptocurrency. One clear winner has been Coinbase. With more than 12 million users, Coinbase is the biggest cryptocurrency platform in the country. The buzz surrounding the possible addition of new coins has been nonstop for much of the past year.

Most recently, the company announced that it is “exploring” the addition of five specific coins: Cardano (ADA), Basic Attention Token (BAT), Stellar Lumens (XLM), Zcash (ZEC), and 0x (ZRx). This is a pretty diverse group from use standpoint: Cardano is developing a smart contract platform; Basic Attention Token focuses on digital advertising in the Brave browser; Stellar Lumens is in the cross-border payments business; Zcash is a privacy coin; and, 0x hopes to offer a decentralized exchange for Ethereum tokens. Mass hysteria quickly ensued following this announcement.

Additional buzz surrounding Coinbase has arisen from its moves towards listing securitized tokens. Last week, there was a bit of an uproar over news that it had been “approved” by the SEC and FINRA to list tokenized securities. They quickly had to walk back or clarify the news because Coinbase itself has not received such approval--yet. Coinbase has, however, received approval from FINRA (and talked informally with SEC regulators) to move forward in its acquisition of a number of companies that would expand its current offerings in the general direction of listing securitized tokens.

Coinbase currently occupies the throne amongst us commoners in terms of U.S. cryptocurrency platforms. It is in hot pursuit of accredited investors (i.e., the bourgeois) and is working to gain regulatory approval to offer its own broker-dealer services. We also recently learned that it has secured a $20 billion hedge fund client for the digital asset custodian service it recently launched. Coinbase is also actively pursuing other hedge funds and rumors have arisen that it has plans to offer financing services by the end of the year. Coinbase is hard at work in making itself more attractive to institutional holders of digital assets, and institutions that have an interest in entering the cryptocurrency space.

And what’s a good business expansion plan without a complimentary government affairs strategy? Well, it’s a not a good business expansion plan. Enter: Coinbase’s political action committee (PAC). Late last week, documents were made public that showed that Coinbase created a PAC. And this is an election year. You do the math. Long live the king.

#coinbase #regulators #SEC #FINRA #institutionalinvestors #accreditedinvestors


Popular posts from this blog

Before You Mint Your NFT

With NFT season taking a bit of a breather (kinda), I thought this would be the perfect time to lay out a few things to consider before minting an NFT.  If you missed the frenzy, well, welcome. "NFT" stands for non-fungible token and these digital tokens represent real world ownership and provenance of a particular asset. NFTs are minted (i.e., produced), stored and transacted (bought/sold/traded) on a distributed ledger like blockchain. Some NFTs represent ownership of tangible assets and some NFTs are digital/virtual assets  (yes, a digital piece of art was purchased for $69M). "Non-fungibility" is a scary word but it essentially means that the asset is unique, cannot be interchanged with another asset, and cannot be replicated. Think of NFTs as either collectibles, like artwork and trading cards, or title to tangible/real property, like real estate and cars.  So with all the excitement having simmered down a bit, below are a few things to think about before you

New home. Who dis?

This post will be short and not blockchain-related. I recently moved my blog to a new platform so I'm still working out the kinks on the aesthetic aspects. Thanks for your patience!

The Rundown on CBDCs

Everyday there is a news report about a country that is "exploring" or "studying" the possibility of developing a central bank digital currency (CBDC). In the past few days, I've read articles about Rwanda, Israel and France looking to pilot programs with CBDCs. And yesterday, the Bank of International Settlements announced its backing of the development of CBDCs. With approximately 80% of central banks around the world taking a closer look at CBDCs, now is as good a time as any to learn more about them. What Are They? A central bank digital currency is exactly what it sounds like--a digital currency issued by a central bank. In the same way our central bank, the Federal Reserve, issues the U.S. dollar, it would similarly issue some official U.S. digital currency ('digital dollar'). This is pretty much where the simplicity of it all ends. Things get really hairy (really fast) when central banks have to figure out how CBDCs fit into a traditional financ