Crypto

“We Want to Be the Amazon Web Services of Crypto,” Says Coinbase’s CEO

Coinbase

Executives at Coinbase have stated that they must quickly become the “Amazon Web Services of bitcoins.”

Coinbase, a cryptocurrency exchange based in the United States, is aiming to leverage Amazon Web Services (AWS) success by establishing its cloud infrastructure solution, Coinbase Cloud.

In an exclusive chat with Forbes, Coinbase chief product officer Surojit Chatterjee remarked, “We want to be the AWS of crypto.” “We’re constructing the entire Coinbase Cloud suite of products, which you can think of as crypto computing services, to enable developers to build apps faster.”

Bison Trails, a cloud-based staking infrastructure solution that Coinbase purchased earlier this year, 2021 for an undisclosed amount that was speculated to be above $80 million, was the service’s previous moniker. Bison Trails is a non-custodial platform, according to Coinbase, which means it doesn’t manage clients’ staked funds.

In Seattle, AWS, Amazon Web Services was formerly a secondary consideration, overshadowed by Amazon. Despite this, Amazon’s subsidiary, which launched nearly 20 years ago, is now the company’s main earnings generator. On a revenue base of $45.3 billion, AWS earned $13.5 billion in yearly operating earnings in 2020.

Officials at Coinbase have stated that they must quickly become the “Amazon of cryptocurrencies.” The majority of its achievements come from having the largest direct listing in history, not from being the first significant digital currency company to go public. As a result, transaction fees account for a large portion of company revenue.

This is frequently the case with line items that are dominated by the revenue concentration of just one category. Facebook and Google, for example, rely nearly entirely on advertising to make money. As a result, their line items have a high level of revenue concentration.

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Coinbase and other exchanges, on the other hand, maybe extremely susceptible due to their reliance on the market and total trade volumes. Because trading volumes are so closely connected to price volatility, such reliance can be a huge disadvantage for cryptocurrency exchanges like Coinbase.

Coinbase and other exchanges, on the other hand, maybe extremely susceptible due to their reliance on the market and total trade volumes. Because trading volumes are so closely connected to price volatility, such reliance can be a huge disadvantage for cryptocurrency exchanges like Coinbase.

To avoid this risk, Coinbase is attempting to increase trading revenue by offering subscription services that are more immune to market volatility. It offers institutional custody, staking options, a learning platform with crypto as a reward, an e-commerce checkout system, and the ability to issue Visa debit cards to clients, among other things. It’s also experimenting with a subscription model that would provide clients with a monthly trading allowance for a fixed fee.

According to Chatterjee, the acquisition of Bison Trails was a crucial milestone in Coinbase’s shift to a more mature financial system. Crypto custodians, funds, decentralized apps, and token holders are all supported by the platform. Andreessen Horowitz (a16z), Current, a New York-based fintech startup, and Turner Sports are among its clients.

Coinbase Cloud has $30 billion in crypto assets on its platform as of November 2021. Coinbase, one of the most prominent cryptocurrency exchanges, has over 73 million legitimate consumers, 10,000 enterprises, and 185,000 ecosystem partners in over 100 countries. Coinbase claims to have processed over $700 billion in transactions since its inception.

The Author

Samuel Adeshina

Samuel is a financial reporter whose interests include blockchain, market, business, insurance, and Crypto to provide relevant information to all interested.