Coinbase, the leading US exchange by trading volume, has announced plans to add half a billion dollars worth of crypto to its balance sheet.
Coinbase CEO Brian Armstrong announced in a tweet Friday that the company’s board of directors had approved the crypto spending frenzy, adding that Coinbase also plans to invest 10% of all profits in digital assets going forward.
Armstrong also stated that the company hopes to increase the percentage of profits it uses to purchase cryptocurrencies over time.
We recently received board approval to buy over $ 500 million of crypto on our balance sheet to add to our existing holdings. And we will invest 10% of all profits in crypto in the future. I anticipate that as the crypto-economy matures, that percentage will continue to grow over time.
– Brian Armstrong (@brian_armstrong) August 19, 2021
A blog post published on the same day by Coinbase announced that the move will establish the exchange as the first publicly traded company to hold ether (ETH), decentralized financial tokens and proof-of-stake assets on its balance sheet.
The announcement underscores Coinbase’s commitment to making long-term investments in the crypto sector, and it states:
“Our investments are continuously spread over a multi-year time window using a dollar cost averaging strategy. We are long-term investors and will only sell ourselves under certain circumstances, e.g. B. when assets are deleted from our platform. “
The post adds that future investments can be influenced by its customers’ holdings, suggesting that Coinbase could add an asset to its balance sheet in the event users make significant custody accounts of a particular cryptocurrency.
Coinbase will conduct its trades on third-party platforms or through its over-the-counter trading desk to avoid conflicts of interest with its customers.
According to Bitcoin Treasuries, Coinbase is currently the eighth largest publicly traded company by Bitcoin (BTC) holdings on its balance sheet and the largest crypto exchange by the value of BTC in its treasury.
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The news of new cryptocurrency spending comes just a day after Coinbase completed its Japanese launch in partnership with Mitsubishi UFJ Financial Group. According to the announcement, Coinbase will also gain access to Mitsubishi’s customer base of around 40 million customers as part of its agreement.
On the same day, Coinbase also announced that it had amassed a $ 4 billion war chest to prepare for regulatory spending and a possible crypto winter.