Ran Neuner, host of of the Crypto Trader show on CNBC Africa, claims that major crypto exchange and wallet Coinbase is about to announce its first Initial Public Offering (IPO), according to a tweet Thursday, Oct. 25.

Neuner states that the details on Coinbase’s IPO are to be revealed Friday, Oct. 26, live on the CNBC Crypto Trader show.

The host also provided statistics on Coinbase’s revenue and account numbers in his post. The infographics show that the number of users on Coinbase has now reached 25 million, with 600,000 actively trading on the platform.

Source: Ran NeuNer’s tweet

As per the data revealed, the California-based crypto exchange has seen $90 million in revenue last quarter, with expectations to earn $450 million in the last quarter of 2018. 80 percent of revenue came from consumers, 15 percent more from institutional accounts, and the source of other 5 percent was not disclosed.

Source: Ran NeuNer’s tweet

Coinbase president Asiff Hirji first hinted about an IPO in late 2017. When asked about the possibility of taking the company public, he said:

“It is certainly in the interest of our investors…and the most obvious path of Coinbase is to go public at some point, but there’s a lot for us to do between now and then, whenever that date is.”

In early October, U.S. tech media Recode cited two unnamed sources familiar with the matter who stated Coinbase was about to finalize a deal that would value the company at about $8 billion. In particular, the crypto exchange was allegedly in talks with Tiger Global and its current shareholders for an investment of up to $500 million.

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Former head of institutional platform group at Coinbase crypto exchange Adam White is reportedly joining Intercontinental Exchange’s (ICE) platform Bakkt. ICE’s new hire was revealed by anonymous sources familiar with the matter cited bynews outlet The Block on Oct. 12.

White left Coinbase in early October, declining to comment on his decision. However, a spokesperson of Coinbase then said that the company was “extremely sad to see him go.”

As per The Block’s source, Bakkt has now hired White as its Chief Operating Officer.

The crypto trading platform Bakkt was first announced in August by the Intercontinental Exchange, which is also the operator of the New York Stock Exchange (NYSE). It has been developed in partnership with Microsoft and Starbucks.

As Cointelegraph previously reported, White has been working for Coinbase for almost five years and was its fifth-ever employee, joining the team at the time it gathered in a one-bedroom apartment and Bitcoin (BTC) was trading at around $200.

While White was working for Coinbase, the company deployed a series of services targeted at big institutional clients, such as custodian services and an index fund.

The exchange, which was recently valued at $8 billion according to some reports, has made a number of high-profile hires in the past months. For instance, this October Coinbase welcomed a board member of the Charles Schwab bank Chris Dodds, and in September it hired Fannie Mae’s former General Counsel Brian Brooks as its new Chief Legal Officer.

Moreover, this summer a former Amazon Web Services (AWS) and Microsoftemployee Tim Wagner joined Coinbase as vice president (VP) of engineering.

 

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Crypto exchange Coinbase is shutting down its institutional-investor focused index fund product, a spokesperson told CoinDesk.

The spokesperson told CoinDesk that the Coinbase Index Fund – first launched earlier this year – will be formally closed by the end of the month, with customers instead directed to the recently-announced Coinbase Bundle product instead. The news was first reported Thursday by The Block.

The spokesperson said:

“After assessing demand from retail, accredited and institutional investors, Coinbase has decided to shut down Coinbase Index Fund. We will focus on providing diversified exposure to all investors through Coinbase Bundle.”

Unlike the index fund, the bundle is open to all Coinbase customers, with no accreditation required. The minimum required investment is only $25 as well, compared to $250,000 for the fund.

“We’ve decided to refocus the resources devoted to managing the Coinbase Index Fund to other parts of the business,” the spokesperson concluded.

The Coinbase Index Fund was first announced in March, though it did not go live until mid-June, when product lead Rueben Bramanathan wrote that institutional investors could invest anywhere from $250,000 to $20 million into the product.

At launch, the fund exposed U.S.-based investors to bitcoin, bitcoin cash, ethereum, ethereum classic and litecoin, which were weighted by market capitalization.

Coinbase also announced its intention to add further assets to the fund should they be listed on any of its trading platforms as well.

The confirmation comes a day after Coinbase announced it was adding the 0x Protocol token (ZRX) to its professional trading platform, Coinbase Pro. The exchange only allowed deposits of the token until Friday morning, and launched full trading later in the day.

That being said, retail investors cannot yet access or trade ZRX through coinbase.com or its mobile apps. Coinbase said Thursday that the token would be added to these platforms at some future point.

This post credited to coindesk Image via Token Summit/YouTube 

As the leading exchange Binance this week showed the power of delisting a coin, another major player, Coinbase just demonstrated the opposite effect.

After Coinbase started to accept deposits of the 0x (ZRX) token on its Coinbase Pro platform yesterday, the token shot up nearly 35% on strong volume, before it started to sell off again. ZRX is up by more than 15% in the last 24 hours (UTC 06:14 AM) and is the only non-stablecoin in green among top 50 cryptocurrencies by market capitalization.

0x Surges on Coinbase Pro Listing, More Coins to Follow 102

Coinbase Pro is the crypto exchange aimed at active and professional traders formerly known as GDAX. In a blog post, the company said it will initially open up three markets for ZRX trading, namely ZRX/USD, ZRX/EUR, and ZRX/BTC.

In its statement, published by Coinbase Pro general manager David Farmer, the popular exchange reiterated previous reports that it intends to continue listing more assets that “meet our standards” in the future.

The statement marks a turnaround for Coinbase, which in the past has been hesitant to list new digital assets on its platform, and for a long time sticking with only Bitcoin, Ethereum, and Litecoin as alternatives for their users to invest in.

In line with earlier announcements from Coinbase, the new asset will not be available in all jurisdictions right away. The company previously said that it is changing its listing process, and will now add new digital assets on a jurisdiction-by-jurisdiction manner in an effort to speed up its addition of new assets.

However, it appears that the new asset will be available in most jurisdictions this time, with only New York state identified as the exception. Back in September, the state of New York was called “hostile to crypto” by Kraken Exchange CEO Jesse Powell after a heated exchange with New York Attorney General Barbara Underwood. According to Powell, his exchange got “the hell out of New York three years ago” in order to avoid difficulties with regulators in the state.

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San Francisco-based cryptocurrency exchange and wallet service Coinbase is finishing negotiations that would value the company at $8 billion, technology news site Recode reports Oct. 2.

Citing anonymous sources familiar with the matter, Recode states that Coinbase is in talks with Tiger Global and its shareholders regarding a possible $500 million investment. The sources reportedly said that Coinbase would add $250 million to its treasury, while another $250 billion could be slated for buying out existing investors.

Tiger Global Management is an investment firm founded in 2011 that invests globally in both private and public markets.

Galaxy Digital crypto investment firm CEO Michael Novogratz said the news about the reported negotiations proved that cryptocurrencies like Bitcoin (BTC) were more than just “tulip mania.” CNBC quotes Novogratz at the Economist’s Finance Disrupted conference on Tuesday:

“Here’s the poster child (Coinbase) of the crypto space worth $8 billion — that’s a real company, and Tiger’s not a flake of an investor. These are smart, savvy guys.”

According to CNBC, a deal with Tiger Global would make Coinbase one of the most highly valued startups in the U.S. Last year, following a series D funding round led by IVP, with participation from Section 32, Draper Associates, and others, Coinbase was worth an estimated $1.6 billion.

Over the past year, Coinbase has moved quickly to expand its business on multiple fronts. In May, the exchange announced the launch of four new products which aim to “unlock $10 billion of institutional investor money sitting on the sideline.”

Recently, Coinbase introduced a new product called “Coinbase Bundle,” which it purports will simplify the crypto trading process. Coinbase Bundles is a basket of five cryptocurrencies supported on Coinbase — Bitcoin, Bitcoin Cash (BCH), Ethereum (ETH), Litecoin (LTC), and Ethereum Classic (ETC) — and purchased in proportion to their market capitalization in U.S. dollars.

Coinbase has also on-boarded a host of talent from traditional financial institutions as well as big name tech companies like FacebookMicrosoftAmazon, and Google. Today, Coinbase announced that Chris Dodds, a member of the board at Charles Schwab, would be joining the exchange’s board to contribute to the Coinbase’s expansion in terms of its financial services capabilities.

 

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Cryptocurrency exchange and wallet service Coinbase has rolled out a new update called “Coinbase Bundles,” which is designed to simplify cryptocurrencytrading, according to an announcement published September 27.

Coinbase Bundles is a basket of five cryptocurrencies supported on Coinbase and purchased in proportion to their market capitalization in U.S. dollars. The Bundle consists of Bitcoin (BTC), Bitcoin Cash (BCH), Ethereum (ETH), Litecoin (LTC), and Ethereum Classic (ETC); the smallest Bundle costs $25, £25, or €25.

While Coinbase has not set up a maximum purchase size for a Bundle, the exchange limits daily purchase amounts on a per-customer basis. Once a customer has bought a Bundle, each type of virtual currency will be stored in their Coinbase wallet and can be bought, sold, sent or received as an individual asset.

Coinbase expects to introduce the new product in the U.S.E.U. and U.K. in the coming weeks. Along with the Coinbase Bundle, the exchange will now host informational asset pages about the top 50 digital currencies in terms of market capitalization, in addition to a “Coinbase Learn” section aimed at educating newcomers to cryptocurrency trading.

Recently, Coinbase announced a new process that will allow it to list more digital assets faster. The process refers to cryptocurrencies that are compliant with local law, which means that certain assets listed on the platform may only be available to customers in particular jurisdictions.

Earlier this month, Coinbase revealed it is looking to create a cryptocurrency-based exchange-traded fund (ETF). Coinbase has reportedly been in discussions with the blockchain working group of asset management giant BlackRock. It remains unclear whether the initiative is concluded or still under negotiation.

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Over the past two days, the valuation of the cryptocurrency market has plunged to $201 billion as Bitcoin lost 13 percent, moving closer to its yearly low at $192 billion.

Since Sept. 6 when the price of Bitcoin dropped by more than 10 percent within a one-hour period, the cryptocurrency market has been on a continuous decline. Tokens bled out more intensely than they previously did in April and June, losing out 10 to 30 percent against Bitcoin.

Source: coin360.io

Cointelegraph interviewed ThinkMarkets chief market analyst and former Bank of America trader Naeem Aslam, eToro senior market analyst Mati Greenspan, and well recognized cryptocurrency technical analyst Uzi, delving into the recent drop of Bitcoin and the rest of the cryptocurrency market.

$40 billion drop: One of the biggest daily decline in recent years

On Sept. 6, the cryptocurrency market lost nearly $40 billion from its valuation in less than 24 hours, demonstrating one of the steepest declines in the past three years.

Source: CoinMarketCap.com

In mid August, the cryptocurrency market dropped to its yearly low at $192 billion, but it took seven days from Aug. 7 to Aug. 14 to record such a large drop in valuation.

Prior to Wednesday, throughout the month of August, Bitcoin showed its highest level of stability since June of 2017, as researchers at Diar noted. From Aug. 8 to Aug. 26, the price of Bitcoin remained relatively stable in the $6,000 region, before initiating an overdue corrective rally above the $7,000 resistance level.

Source: CoinMarketCap.com

But, a rushed rally from the $7,000 mark to $7,400 within a four day period led sell pressure to build up, allowing bears in the cryptocurrency exchange market to take over, leading Bitcoin to fall by a large margin.

In late August, ShapeShift CEO Erik Voorhees said that the bear market is not over yet, but the low price range of major cryptocurrencies present a viable opportunity for new investors to come into the market.

The daily chart of Bitcoin demonstrates four similar movements since February. In the past six months, Bitcoin has risen to $10,000, fell to $6,000, recovered to $10,000, and tested the $6,000 resistance level on four occasions.

In February, Bitcoin surged to $11,000 but fell back down to $6,000. In April, Bitcoin rose to $10,000 and dropped to $6,000. In July, Bitcoin rallied to $8,500, only to test the $6,000 resistance level a month later. In September, the same pattern occurs, with each peak on the upside eventually declining $6,000.

Caption: One-day Bitcoin price chart from Cryptowat.ch

If Bitcoin recovers from the $6,000 support level, the next short-term rally could send Bitcoin to $7,000, which may fall back to the $6,000 region. But, if the dominant cryptocurrency can successfully bottom out in the $6,000 region, a possibility for a proper mid-term rally with newly found momentum could emerge.

Factors behind the drop

Speaking to Cointelegraph, ThinkMarkets chief market analyst Naeem Aslam said that speculators have unnecessarily intensified the downtrend of Bitcoin by overselling Bitcoin in the global exchange market.

Aslam emphasized that the downward trend of Bitcoin has not changed since December of 2017, when the cryptocurrency market achieved a $900 billion valuation and initiated a rapid decline:

“Speculators have gone crazy and they are trying to squeeze as much blood out of this trade as they can. Bitcoin hasn’t changed what it was since last December, so what is the panic?”

Aslam added that it is difficult to pinpoint specific factors that have led the price of Bitcoin to drop substantially in recent months.

Analysts and investors in the cryptocurrency market and the broader financial market often attempt to find correlation in cryptocurrency price movements to developments in the cryptocurrency and blockchain sector.

However, correlation is not equivalent to causation, and because an event occurs at a certain time in which cryptocurrency prices fall or surge by a large margin, it does not necessarily mean that the event triggered a big movement in the cryptocurrency market.

TABB Group, an international research company, reported in July that the over-the-counter (OTC) Bitcoin is at least two to three times larger than the cryptocurrency exchange market.

Under the assumption that the OTC market is in fact two to three times bigger than the exchange market of crypto, developments in the cryptocurrency sector should have minimal impact on the price movements of cryptocurrencies — at least in the short-term — as the exchange market depends on the larger OTC market.

Reports have suggested that the correction of Bitcoin initiated on Wednesday was mainly caused by the delay in the decision of Goldman Sachs to launch a Bitcoin trading desk.

It is far-fetching to claim that the decision of a major investment bank to pivot from offering Bitcoin trading services — which may not appeal to its consumer base of institutions and large-scale corporations — to cryptocurrency custodian services led the price of Bitcoin to plunge within an hour.

Rather, it is more likely that the continuous build up of sell pressure on Bitcoin and other major cryptocurrencies since December of 2017 created instability and volatility in the market, causing the valuation of the market to drop.

Because the volume of Bitcoin remains relatively low in comparison to traditional assets and stores of value like gold, it is easier to trigger a domino effect across leading cryptocurrency exchanges.

Goldman Sachs delaying Bitcoin trading desk not relevant

On Sept. 6, Cointelegraph reported that Goldman Sachs has delayed the formal launch of its Bitcoin trading desk that is structured to facilitate rising demand from retail traders and individual investors.

Goldman Sachs spokesperson Michael DuVally told Reuters that the bank has not been able to reach consensus on the roadmap of its digital asset venture, citing various regulatory issues that currently exist in United States markets.

Hours after the statement of DuVally was released, Martin Chavez, the chief financial officer at Goldman Sachs, personally refuted reports that the institution is pivoting away from forming a Bitcoin trading desk operation, characterizing reports around it as “fake news.”

Aslam stated that it is premature to attribute the market’s struggle throughout this week to the delay in the launch of the Bitcoin trading desk operation by Goldman Sachs, as the bank has not closed its operation but merely delayed it to focus on a more urgent initiative that is cryptocurrency custodianship:

“Goldman has only delayed the process, they still have invested a lot of money and talent in this area. Investors must know it is very normal for banks to delay the IPO process if the market conditions are not favorable and over here we are talking about starting something completely new. Goldman has its fingers in many of the areas when it comes to Bitcoin, so stop thinking about it and focus on the price.”

Currently, the cryptocurrency market has a wide range of regulated exchanges in the likes of CoinbaseGemini, and UPbit that can be used by retail traders to invest in the cryptocurrency market. However, it lacks trusted custodianship and solutions that can break the barrier between cryptocurrencies and institutions.

It can be argued that Goldman Sachs is working on a more urgent issue that needs to be addressed in order to convince the broader financial market and governments to acknowledge cryptocurrencies as an emerging asset class.

As such, while the Goldman Sachs announcement contributed to the fall of the market, as cryptocurrency technical analyst Uzi told Cointelegraph, it is difficult to acknowledge Goldman Sachs as the sole cause for the correction. Bitcoin was already facing resistance around $7,400, the peak it achieved last week before sliding downwards:

“I feel the Goldman Sachs news about them rolling back plans on their crypto trading desk definitely helped trigger the Bitcoin drop, we were facing some tough resistance around $7,400 as well, but it’s not the biggest secret in the world that a massive amount of BTC shorts was added on Bitfinex days before this drop. 10K BTC in shorts, I believe — follow the money, as they say.”

Same bear trend since February

Mati Greenspan, a senior analyst at eToro, one of the largest multi-asset trading platforms in the global finance sector, with eight million active users, echoed the sentiment of Aslam by stating that the cryptocurrency market has been in a similar trend over the last few months, unable to break out of the $8,000 resistance level with solid volume and momentum:

“Volatility in the crypto markets has picked up over the last few days but is still pretty normal for this market. As far as Bitcoin’s price is concerned, the price has been in a rather stable range between $5,000 and $8,000 for the last few months and this hasn’t changed.”

Greenspan added that the volatility in the market can be attributed to the lack of demand from traders in the cryptocurrency sector, rather than specific events which analysts have pinpointed as the primary cause of the recent correction.

“Several possible reasons for the drop could be a few bad rumors that are circulating in the press, along with a stronger dollar and weakness in tech stocks. Ultimately though, it’s simply a matter of more supply and less demand in short-term trading.”

Technical analyst says Bitcoin market is illiquid, fake volumes

Bitcoin is not considered a sufficiently liquid market, especially considering the fact that its exchange market is open to any individual investor and retail trader in the global market. While cryptocurrency market data providers estimate the daily volume of Bitcoin to be around $5 billion, studies have shown that most major cryptocurrency exchanges inflate their volumes through wash trading.

Alex Kruger, an economist and a cryptocurrency trader, stated earlier this week that Bithumb, South Korea’s second largest cryptocurrency exchange behind Kakao-run UPbit, said that more than $250 million worth of fake volume was created since Aug. 25.

He explained that one group of traders has been taking advantage of Bithumb’s 120 percent trading fee payback, which can generate about $90,000 in net income, with a $250 million daily trading volume.

“There currently are $250 million [in] fake volume traded at [the] Korean crypto exchange Bithumb, every day at 11 a.m. Korean Time, since Aug. 25. Bithumb offers 120 percent payback of trading fees as an airdrop. Trading fees are 0.15 percent taker. To collect the full KRW 1 billion rebate, a wash trader must thus trade KRW 278 billion. That is $250 million in daily fake volume. Notice how 31K Bitcoin are traded at exactly 11 a.m.”

Directly or indirectly, the method utilized by Bithumb has incentivized wash trading that bumps up the daily trading volume of the cryptocurrency exchange. The end outcome is a daily net income of $90,000 for a group of traders and a significant increase in the daily trading volume of Bithumb.

However, while the method leads to a win-win situation for both parties, it affects the global cryptocurrency exchange market in a negative way — as it reduces the authenticity of the international trading volume of cryptocurrencies.

Uzi stated that liquidity and fake volumes are two problems that cryptocurrency exchanges will have to address urgently, to ensure that investors in the market are protected and governments can recognize the sector as a legitimate industry:

“Solving the liquidity issue is one that needs to be tackled, and the issue of fake volume is something that needs to be addressed on a larger scale, because there are definitely questionable volumes on major exchanges.”

Uzi also noted that the Bitcoin market is still generally illiquid, given the lack of activity from institutions and large-scale hedge funds in the sector. He stated that the market is still not ready to support big demand from institutional investors, and most short or long contracts around Bitcoin filed through the U.S. futures market or cryptocurrency exchanges are done by individual investors.

“I have always felt the market for Bitcoin is still illiquid, and especially if you look at the altcoins market. I don’t feel any professional institution would take up a short position at that time on Bitcoin just out of the sheer volatility and the momentum it had testing a decent resistance, as well as the massive short being opened that was noticeable to most, it would be terrible risk management.”

Where the market goes next with Coinbase ETF variable

As Cointelegraph reported on Sept. 7, the world’s largest asset manager BlackRock, which oversees $6.317 trillion in assets, and Coinbase, the cryptocurrency sector’s biggest exchange and brokerage, are in talks to develop a cryptocurrency-based exchange-traded fund (ETF) to bolster market activity and facilitate growing demand from institutions for cryptocurrencies.

The entrance of VanEck and the Chicago Board Options Exchange (CBOE) has already increased the probability of the approval of the first Bitcoin ETF by the U.S. Securities and Exchange Commission (SEC). The involvement of BlackRock will create more competition in the Bitcoin ETF space among U.S.-based regulated financial institutions, which may lead to more contenders filing with the SEC to improve the liquidity of the dominant cryptocurrency.

Variables like Bakkt, the Coinbase-BlackRock ETF and positive regulation-related developments in Japan and South Korea could contribute to the recovery of the cryptocurrency in the short-term, which previous corrections in 2012, 2014, and 2016 did not have.

Experts generally agree that the correction of the cryptocurrency market on Sept. 6 was caused by increasing sell pressure and a culmination of various developments, rather than a single event like the Goldman Sachs Bitcoin trading desk announcement having an immense impact on a global market.

 

This post credited to cointelegraph  Image source: Cointelegraph