Coinbase CEO Details New Revenue Streams Hours Before NASDAQ Listing
Key Takeaways
- Brian Armstrong went on Squawk Box to discuss Coinbase’s business model.
- Investors are wary that the exchange relies too heavily on transaction fees.
- Armstrong said we will not see lower fees on Coinbase on the short-term.
Brian Armstrong expects Coinbase Earn, its debit card, custody for institutional clients, and staking revenue to become more than half of the firm’s revenue.
Coinbase Soothes Investor Worries
In 2020, 96% of Coinbase’s revenue was generated through transaction fees. As competition in the space mounts, however, Armstrong’s firm will likely need to lower those fees. Investors, specifically those eyeing COIN, are acutely aware of what this means for its share price: dwindling revenues.
Amstrong went on CNBC’s Squawk Box to soothe these woes and explain how his company plans to adapt its revenue streams.
While Armstrong said that the crypto exchange isn’t planning to reduce its fees yet, the company is developing alternative revenue streams if competition becomes too problematic. Amongst these alternative revenue streams, Armstrong referenced Coinbase Earn, its educational program that gives out cryptocurrencies to those who learn about them.
Learning about crypto in the same place where one might purchase crypto may lead to new users joining the platform.
Coinbase also defended their model by saying that a custody fee is included in the transaction fees since the exchange is responsible for holding the assets bought by users. Armstrong also mentioned the firm’s debit cards, staking rewards, and their growing business of institutional clients as potential revenue streams in the long term.
According to the CEO, these could represent more than half of Coinbase’s revenue in the next few years.
Coinbase will list on Nasdaq on Apr. 14, under the ticker COIN. Binance has announced that trading of tokenized versions of COIN would be possible on their platform shortly after.
Disclaimer: The author held BTC, ETC, and a number of other cryptocurrencies at the time of writing.
The information on or accessed through this website is obtained from independent sources we believe to be accurate and reliable, but Decentral Media, Inc. makes no representation or warranty as to the timeliness, completeness, or accuracy of any information on or accessed through this website. Decentral Media, Inc. is not an investment advisor. We do not give personalized investment advice or other financial advice. The information on this website is subject to change without notice. Some or all of the information on this website may become outdated, or it may be or become incomplete or inaccurate. We may, but are not obligated to, update any outdated, incomplete, or inaccurate information.
You should never make an investment decision on an ICO, IEO, or other investment based on the information on this website, and you should never interpret or otherwise rely on any of the information on this website as investment advice. We strongly recommend that you consult a licensed investment advisor or other qualified financial professional if you are seeking investment advice on an ICO, IEO, or other investment. We do not accept compensation in any form for analyzing or reporting on any ICO, IEO, cryptocurrency, currency, tokenized sales, securities, or commodities.
See full terms and conditions.
Source: Read Full Article
