Coinbase, the largest crypto exchange headquartered in the United States, now has a valuation of over USD 8 billion following USD 300 million of investments during the Series E equity round. This is a 433% increase of Coinbase’s valuation, which was USD 1.5 billion in the summer of 2017. This investment round was led by Tiger Global Management, and included investments from Andreessen Horowitz, Y Combinator Continuity, Wellington Management, and Polychain.
This investment money will be used for global expansion, where Coinbase will be launching fiat to crypto trading in regulated markets worldwide. The money will also be used to accelerate the addition of as many crypto assets as possible. Coinbase President and COO Asiff Hirji said, “We see hundreds of cryptocurrencies that could be added to our platform today and we will lay the groundwork to support thousands in the future.” This is a major change from the fewer than ten cryptocurrencies listed currently. Already, this process has begun with the addition of 0x and USD Coin during the month of October 2018.
A major utilization of this investment money will be for building infrastructure to target institutional investors. Coinbase has already launched Coinbase Custody, which is now a qualified custodian in the United States. Institutional investors require a combination of qualified crypto custodians, crypto hedge funds, and proper investment products. It appears Coinbase will try to do all of these things. It is generally believed that institutional investors will cause the next big crypto rally.
Further, the exchange will use the investment money to build crypto utility applications, such as a Coinbase wallet, and will engage in partnerships to build new crypto and blockchain technology.
Coinbase is already dominant among United States crypto exchanges, with USD 1.3 billion of revenue projected in 2018, and this USD 300 million investment will likely increase this dominance.
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