Coinbase added $500m worth of crypto to its company balance sheet according to CEO Brian Armstrong as he announced on Twitter and we are reading more about it in our latest Coinbase news.
The crypto exchange Coinbase added $500M worth of crypto assets to its balance sheet but also it will be placing 10% of all future profits into crypto. In February, as it prepared to go public via a direct listing, Coinbase published an S-1 filing showing that it held somewhere between $365 million in crypto and $230 million was in Bitcoin, $53M in Ethereum, $34 million in other crypto-assets and $49 million in stablecoins.
Though it was good enough to rank Coinbase fourth among the companies for BTC holdings, two of the three companies ahead of it like Tesla and Microstrategy bought their first BTC in the last year while Coinbase has been here since 2012. Some believe a crypto-native company should have gathered some more crypto in that timespan but the accounting rules and treasury management principles could have made that imprudent. Back-to-back record quarterly profits show that the company made $800 million in Q1 and then $1.6 billion in Q2 which convinced the exchange’s board it still has room to diversify its holdings.
We recently received board approval to purchase over $500M of crypto on our balance sheet to add to our existing holdings. And we'll be investing 10% of all profit going forward in crypto. I expect this percentage to keep growing over time as the cryptoeconomy matures.
— Brian Armstrong (@brian_armstrong) August 19, 2021
The exchange which makes most of the money from transaction fees, benefited from the high trading volumes in the past quarter despite teh crash in crypto prices as BTC dropped from its high above $60K all the way to $30K. According to Armstrong, the company will gradually operate more of the business in crypto.
As recently reported, Coinbase goes live in Japan after it announced a partnership with the banking giant Mitsubishi UFJ Financial Group. The company led by CEO Brian Armstrong announced that it will first launch retail trading products like a suit of five top assets based on trading volume with even more assets and products to be listed on teh platform in the next few months. Coinbase had its eyes on the Japanese market for a while now and back in October 2019, the company said it was seeking licensing approval from Japan’s financial regulator- the FSA or Financial Services Authority. The company registered a crypto exchange with an FSA approval and self-regulatory organization the Japan Virtual Currency Exchange Association. Coinbase hoarded some funds worth $4 billion to prepare for teh decrease in retail trading in case of a possible “crypto winter” along with the increase in costs brought on by teh regulatory compliance hurdles.
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