Coinbase expands to a higher level.
The name Coinbase may not be making much of a splash in the headlines lately, but the company is quite busy preparing its business for eventual expansion. The San Francisco-based cryptocurrency exchange is reported to be in talks with the Security and Exchange Commission for its possible registration as a licensed brokerage and electronic trading venue which further cements its reputation as being the most legally compliant in the industry. In addition, the company also announced a new venture fund for cryptocurrency startups as well as support for Bitcoin forks withdrawals.
The recent upheaval in the crypto market has obviously not shaken Coinbase’s confidence in the industry’s feature as it continues to pursue the company’s plans. The latest talk going around is that the crypto exchange, considered to be one of the largest in the world, has breached the possibility of becoming a licensed brokerage firm with the SEC.
As pointed out by Digital Trends, Coinbase’s registrations with the SEC, once completed, will have a two-fold effect on the company’s clients and the industry as a whole. First, it could mean that Coinbase may expand the number of cryptocurrencies it could offer which could include those digital coins that SEC classifies as securities. In addition, the move will put pressure on the company’s competitors to register their operations with the SEC as well.
“The assets that we do list have all had some amount of regulatory certainty,” Coinbase president Asiff Hirji explained. “As soon as there is more regulatory clarity than there currently is, you would expect us to start listing more assets.”
Cryptocurrency analysts have been saying that regulation is not necessarily a bad thing for the industry. Smart regulation could essentially dampen the effects of market corrections, which means that people would not have experienced that horrifying plunge of crypto prices early this year – there might have been a correction, but the downtrend might have been a bit smoother. Of course, the proper regulations could also deter crypto-related crimes and scams.
Coinbase’s registration with the SEC could spur the growth of its customer base. The move could convince crypto investors to do business with the exchange due to the fact that it is now SEC regulated.
Coinbase has also vowed support for blockchain and cryptocurrency startups. Last week, the company announced that they’ll be launching an incubator fund specifically designed to help startup companies in the cryptocurrency industry.
“We’re going to invest off our balance sheet into crypto companies,” Asiff Hirji told CNBC’s “Fast Money” Thursday. “We will invest in companies that are in the space and are aligned with our values.”
Surprisingly, Coinbase launched the venture fund even if it meant that the company would be investing in its competitors. But the exchange defends this move by saying that they are viewing the investment from a long-term perspective.
“You may also see us invest in companies that ostensibly look competitive with Coinbase. We’re taking a long-term view of the space, and we believe that multiple approaches are healthy and good.”
Meanwhile, Coinbase announced that it will be supporting Bitcoin hard forks in the coming months. At the moment, the company’s support will cover withdrawals for this Bitcoin offshoots but the date when the support will take effect is not yet revealed.