Coinbase denies IPO rumors, prepares for revenue diversification

The recent news about the tremendous success of Coinbase on the marketplace has been circulating all week. People are expecting some major changed from the side of the cryptocurrency exchange. The biggest rumor surrounding the emerging giant is that they would have an IPO coming at the end of the year.

The reason for the rumor was an investment from a New York hedge fund Tiger Global Management which boosted the exchange’s value to $8 billion. However, the COO of Coinbase, who is also the president, Assif Hirji in an interview with Bloomberg completely disregarded the rumor assuring potential investors that it is definitely not on its way.

A spot next to the big boys

Coinbase is currently the #1 primary cryptocurrency exchange provider in the United States. However, the company likes to operate through their subsidiary Coinbase Pro, while they reside in San Francisco. The reason behind their popularity is the volume they handle every day, nearly $54 million in trades according to coinmarketcap.

A massive investment corporation may be on its way, however. Because the crypto exchange has been courting Wall Street in these last few months. This time it is actually factual, that the company may be preparing for a couple of high-end hires for executives with institutional experience. All of this is building up to accommodating large investors and a Bitcoin exchange fund.

In the latter half of 2018 it has been moving away from the traditional market for cryptocurrency – the general public – and making moves to court Wall Street. These moves include setting up a custody service for big money investors, hiring no fewer than four executives with institutional experience, and planning a Bitcoin-based exchange-traded fund with a massive investment corporation.

Coinbase’s new plans

Coinbase has also been preparing for Brexit. The company is hoping to have steady access to the EU market as regulations are starting to kickstart in the region. Currently, their main branch in the EU is located in Dublin, which ensures service to over 23 European countries. The COO Assif Hirji also clarified that an IPO was not on their priority list at this point in time. Their current focus is on the diversification of revenue streams. The company only relies on its transactional revenues at this point, which could backfire as the market further spirals into decline, 83 percent since January 2018 already. One of the ways they are planning to do this is to start listing a number of tokens in order to stabilize the company’s reactions to big boy crypto fluctuations.

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Konstantin Rabin

About the Author: Konstantin Rabin

Konstantin has been working in the financial services industry since 2011. He is over-viewing various updates in the technology, regulation, and market movements. He's passionate about games and has a cute cat named Dog.

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