Having said that, many skeptics have questioned the company’s next move and what the development means for the rest of the market. For instance, is this the market top for crypto? This is a pertinent question, especially since its leading cryptocurrencies hit price highs before and after Coinbase went public through a blockbuster direct listing on the Nasdaq.
Coinbase Co-founder Fred Ehrsam was quick to cater to the queries in a recent interview hosted by CNBC. According to the exec,
“The cryptocurrency market has not yet reached its apex, even if trading in various digital coins remains choppy going forward.”
On the question of skeptics claiming that this might be the market top, Ehrsam said, “As somebody who’s been working in crypto for 10 years, I’ve heard that statement hundreds, if not thousands, of times.”
The interview also touched upon a possible correlation between Coinbase’s valuation and the valuation of Bitcoin. In fact, a similar question was posed to Coinbase’s CEO Brian Armstrong in another CNBC interview. Understandably, both the founding members had almost the same answer.
“There’s a lot more going on in the crypto-space. Our main aim is to make the entire crypto easy to assess for all of our users. Talking about the correlation, I’d say it’s less correlated to any singular asset but instead the crypto overall.”
Coinbase has for long been associated with Bitcoin and other cryptocurrency assets. Fundamentally, growth in Bitcoin’s price should have a positive impact on Coinbase as well. As per the company’s revenue cycle, as an exchange, the revenue cycle of Coinbase obviously doesn’t depend only on Bitcoin going up. The company earns fees and commissions when people are buying and selling digital assets on the platform.
Talking about the company’s future endeavors next, the Co-founder said,
“I think the reality is that if crypto is to achieve the huge mission that I think it can — which is being a new global digital money, financial system, and internet app platform — there is bound to be a lot of volatility along the way. It’s certainly not for the faint of heart in the early days, and that was a huge challenge in building Coinbase and staying the course.”
Many critics have for long criticized the crypto rally’s sustainability. A recent Bank of America Fund Manager Survey, for instance, found that about 74% of respondents think Bitcoin is in a bubble. In fact, Federal Reserve Chairman Jerome Powell also claimed that cryptocurrencies are “really vehicles for speculation.”