Leading U.S. crypto exchange Coinbase is expected to be valued at over $8 billion following its upcoming funding round. The event is slated to bring in an additional $500 million for the popular trading platform and may be led by leading venture capital firm Tiger Global.
Carving the Route for Change
Coinbase is one of the biggest corporate figures in the crypto space. At only six years old, the digital exchange often sets the tone for what will occur regarding digital asset trade. For example, despite a growing fear back in May that Ethereum – the second-largest cryptocurrency by market cap – would be declared a security by the Securities and Exchange Commission (SEC), the platform expressed no worries, saying it would never list anything that had the potential of becoming a security and that it was confident Ethereum would remain as it was.
As fate would have it, the currency was later deemed “too decentralized” by the SEC to fall into the securities category, and Coinbase had the glory of saying “I told you so” to doubters. However, the platform has been consistently dismissive of Ripple’s currency XRP, which it states could be labeled a security in the coming months. Ripple CEO Brad Garlinghouse has consistently pleaded with the company for an XRP listing – something that Coinbase continues to reject.
Its Power Exceeds That of Others
Among Ripple’s biggest issues is that approximately 60 percent of XRP is still owned by the company, suggesting it’s a centralized currency. In addition, the company is now facing a class-action suit from investors who claim that Ripple has not followed appropriate securities laws and potentially misled clients in the process.
Coinbase also has the power to bring specific coins to light and garner them newfound attention and value. For example, in August the company announced it would begin listing Ethereum Classic. As a result, the currency exploded and saw price bursts exceeding 30 percent within its first few weeks of availability.
A Long History of Financial Success
Tiger Global has a powerful history of raising capital for growing financial firms. Recently, the company led a $245 million funding round for the payment platform Stripe. It has now set its sights on Coinbase, with whom it’s trying to reach a winning deal. Coinbase was previously valued at approximately $1.6 billion following a $100 million funding round back in August 2017.
The latest event is expected to bring capital from several top shareholders including Andreessen Horowitz, Ribbit Capital, IVP, Union Square Ventures and Battery Ventures.
Growing the Family
In addition, Coinbase has announced to new hires to its team. The first is Jonathan Kellner, who will work as the managing director of Coinbase’s institutional coverage group. His duties will be to lead institutional sales and support organizations that focus on Coinbase’s efforts to introduce crypto to different hedge funds and other institutional investors.
The second hire is Chris Dodds, who will serve on the company’s board of directors. Recently, Dodds served on the board of Charles Schwab and worked as a senior advisor to The Carlyle Group.
Moving in a New Direction
Recently, Coinbase CEO Brian Armstrong announced that he was interested in making Coinbase a public company, preferably on the blockchain. At the TechCrunch Disrupt event in San Francisco last September, the entrepreneur and executive stated:
“We are self-sustaining. You know, we’ve been profitable for quite a while. We don’t have any plans to raise additional capital at this point, but never say never. Someday, I’d love to run a public company. I think that would be very on mission for us to do that because, of course, we are creating an open financial system. Companies could list their stock, which are really tokens, and instead of a cap table, you tokenize the cap table, but I don’t have any decisions on that right now.”
