Submitted by Market Crumbs
Choosing to go public through a direct listing as opposed to a traditional IPO, Coinbase revealed in the filing that total revenue surged to $1.2 billion in 2020 from $533 million in 2019. Coinbase also shared that as of the end of last year the platform had 43 million verified users, $456 billion in lifetime trading volume and $90 billion in assets.
"The current financial system is rife with high fees, unequal access, and barriers to innovation,” Coinbase co-founder and CEO Brian Armstrong wrote in the filing.
"If the world economy ran on a common set of standards that could not be manipulated by any company or country, the world would be a more fair and free place, and human progress would accelerate."
Coinbase listed countless risk factors such as declining cryptocurrency prices and waning confidence in the space, while also including "the identification of Satoshi Nakamoto, the pseudonymous person or persons who developed Bitcoin, or the transfer of Satoshi’s Bitcoins" as a risk factor.
While the news of Coinbase's upcoming listing stole headlines, it was a blog post from the day before that was of interest. With companies such as Tesla and MicroStrategy making news for adding bitcoin to their balance sheets, Coinbase's blog post discussed the company's capabilities for corporations looking to follow suit.
Coinbase's Head of Institutional Sales, Trading, Custody and Prime Services Brett Tejpaul wrote that the company has held bitcoin and other crypto assets on its balance sheet since 2012, before adding the company intends to hold them because they "believe strongly in the long-term potential of the cryptoeconomy."
This experience has helped Coinbase develop a solution for corporate companies that are interested in adding and managing digital assets as part of their corporate treasury strategy. Coinbase even put together an FAQ for corporate treasuries looking to explore their "more than white glove service."
"Coinbase has efficiently executed nine and ten figure trades for some of the largest institutions in the world," Tejpaul wrote. "Clients have selected us for our track record in security, sophisticated execution platform, 24/7/365 white glove service, and focus on regulatory compliance."
By sharing its expertise with corporate clients, Coinbase is committed to helping cryptocurrencies grow by creating a digital currency exchange linked to the traditional financial system. Coinbase is looking to share its expertise in areas such as trading and custody, tax and accounting, and even talking points companies can use when adding digital assets to their balance sheets.
"Institutions across the board are building for a future that is protected from new risks; this includes building a diverse balance sheet that is adequately hedged from the traditional capital markets and monetary debasement," Tejpaul wrote. "On the corporate side, use cases for digital assets are expanding rapidly from traditional portfolio management as an investment asset within a diversified portfolio — to accounts receivable/accounts payable, employee payroll, and commerce integration, for example."
As Coinbase nears its debut on the public market, the company's offerings for corporations looking to follow Tesla into adding bitcoin to their balance sheet may prove to be a large part of their business as adoption grows.