Currently, investors are very bullish on cryptocurrency in general. The digital, non-centralised currencies such as bitcoin and many others represent the potential to make a lot of people a lot of money. So obviously, these cryptocurrencies are in the news quite a lot these days. Coinbase is a cryptocurrency platform – the second largest cryptocurrency exchange in the world and has been in the news a lot as well.
Based in the United States, this is a company that operates a cryptocurrency exchange platform and is today the largest such exchange in the US by trading volume. Set up in 2012, the company had one million users by 2014. It offers a vault system for secure bitcoin storage and partners with several other companies to allow payments in bitcoin. As of October 2020, the company announced that it would be launching a Visa Debit Card program.
Products for retail traders include the Coinbase app to buy, store and trade currency with a pro version that permits trading of a wider variety of digital assets and the Coinbase wallet. Coinbase also offers products for institutional traders such as custodial accounts and other crypto-related products such as USD Coin. The company has published some impressive earnings numbers this month, owing largely to the increase in the price of Bitcoin in the past several months.
The company has an India connection and in March 2021, made an announcement that it was establishing a business presence in the country. The company said it would be setting up an office in Hyderabad and hiring people for software development, engineering and customer support services.
The thing that has really catapulted Coinbase into the headlines is the company IPO. Slightly different from the IPO process, the company started to trade via direct listing, where the company acts along with financial institutions to sell stock. When it was listed and started trading on the Nasdaq stock exchange this created ripples in financial circles, needless to say.
It debuted on Nasdaq last week and was valued at almost $100 billion. However, in hours of starting trading, the stock price went up to $429.54 (reference price being $250) and then closed at $328.28. Obviously, this made a lot of people a lot of money, including Coinbase’s chief product officer Surojit Chatterjee who is now worth about Rs. 5000 crore.
According to experts, the reason why Coinbase is such a big deal is that crypto itself is such a big deal right now. Coinbase is described as the ‘Google of Crypto’. The company’s $85.8 billion valuation, its 56 million users, who are able to trade in over 50 different cryptocurrencies are aspects that promote faith in the company and its prospects. 2020 revenues were in excess of 1.2 billion dollars and the company has already made $1.8 billion so far this year.
Ease of trading and the built-in security features of the platform recommend themselves. The company is seen to be taking ‘crypto to the masses’ and has made it more accessible even to those investors who are otherwise wary of tech. Right now, it seems as though Coinbase is doing a lot of things right and that it is going to be a force to reckon with in the near future.
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