What’s Going On?
Cryptocurrency exchange Coinbase has purchased Ethereum startup Paradex.
Why Does It Matter?
Coinbase is looking to get around regulatory hurdles following the acquisition of Paradex, a service which allows users to trade cryptocurrencies without relying on a trusted third party, reported Mashable.
Forbes explained that unlike traditional exchanges, Paradex lets users “relay” cryptocurrency directly to each other. A third party isn’t required to take custody of the token during transfer.
What’s The Big Deal?
With $150 billion in assets, 20 million customers and 2017 revenue reported at $1 billion, Coinbase was in the right place at the right time to benefit from crypto’s enormous bull run, reported CNBC. Coinbase has more than $225 million in funding from VCs including Andreessen Horowitz, Union Square Ventures and the New York Stock Exchange.
Coinbase president and COO Asiff Hirji told CNBC: “We don’t see ourselves as a crypto exchange. We are very focused on the establishment of the crypto economy. We see ourselves as enabler of that future economy. What we provide is an on-ramp from the old economy to the new, from fiat to crypto. We need a bridge to get there, and we are providing that bridge.”
Paradex will effectively allow Coinbase users to trade in hundreds of new cryptocurrencies, which is a huge step for the company, reported Mashable. It is to be integrated as part of an overall rebrand, but will initially only be available to international accounts, not US users.