Coinbase has announced a $500 million investment in Bitcoin, Ethereum, and other crypto-assets. They believe the new policy will allow them to keep Bitcoin, Ethereum, Proof of Stake Assets, Defi tokens, and other crypto assets on its balance sheet.
Coinbase, the leading cryptocurrency exchange in the United States, has modified its investment policy to encourage more investment in crypto assets. According to a recent blog post, Coinbase has chosen to alter its investing policy to include more crypto assets. According to the business, the decision was made after it was discovered that the “bulk” of Coinbase’s corporate financial transactions, such as paying vendors, employees, and investing corporate cash, are significantly weighted in fiat.
Additionally, the blog post stated that Coinbase’s new strategy commits to investing $500 million of its existing cash and cash equivalents in crypto assets, as well as 10% of its future quarterly net income:
Going forward, we will also allocate 10% of quarterly net income into this same portfolio.
Coinbase believes that the policy change will make them the first publicly traded business to hold Bitcoin, Ethereum, Proof of Stake Assets, Defi tokens, and a variety of other crypto assets on their balance sheet. The company’s assets would be allocated based on “aggregate custodial crypto balances,” implying that client decision-making will play a role in the company’s investment strategy.
Coinbase wants to deploy its investment utilizing dollar cost averaging over a multi-year period. According to the announcement, the corporation views itself as “long-term investors” that will only divest in exceptional circumstances, such as when an asset is delisted. To avoid a conflict of interest with customers, Coinbase will also execute trades through their over-the-counter desk.
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