When it comes to cryptocurrency trading platforms, Coinbase remains one of the biggest service providers. The company has noted tremendous growth over the years. So much even that CEO Brian Armstrong shares some very peculiar statistics. It seems a lot of puzzle pieces are coming together for this service provider, which could hint at a rather interesting future.
Xapo Sells to Coinbase
Perhaps the biggest development this week – which has seemingly gone by unnoticed – is how two of the bigger companies in the Bitcoin industry have come together. Xapo, a well-known service offering wallets and custodial services, is slowly changing its business model. Wences Casares confirmed Xapo’s Institutional Custody Business has been sold to Coinbase. It is a remarkable decision, yet it will not mean the end of Xapo whatsoever.
Instead, this means the company can emphasize its customer focus in terms of COnsumer Business. By actively extending their services on a global scale, it seems Xapo is now targeting regular consumers rather than institutions. New products are expected to be released in the months to come. The company’s digital multi-currency wallet and card will continue to be developed as they always have.
Coinbase Custody is Number 1
Even prior to the acquisition, Coinbase Custody was leaving all of its competitors in the dust. It is the world’s largest cryptocurrency custodian service on the market, and will continue to be for some time to come. For a service which hasn’t been around all that long, maintaining $7bn in Assets Under Custody is quite impressive in its own regard. Other interesting statistics are provided as well. Coinbase Custody spans over 120 clients in 14 different countries. One would expect that latter figure to look a bit different. Cryptocurrencies are designed to become global tools, rather than regional solutions.
The bigger question is how this growth is to be sustained. Impressive numbers are one thing, but maintaining these rates won’t be easy. Cryptocurrencies provide financial freedom to their holders. Some parties are more intent on giving up that freedom as soon as they acquire it. There will always be a demand for custodial services, but that is not what cryptocurrencies are about.
Massive Weekly Deposits
The most interesting statistic is provided by Armstrong in a follow-up Tweet. He claims there is between $200m and $400m worth of fresh assets coming in from institutional customers every week. That is quite the spread on the exact figures. It also raises a question as to who is depositing such vast amounts these days. Given the lackluster price trend of Bitcoin and altcoins, it seems these “fresh” assets are not acquired recently.
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