Coinbase Offers Another Way to Ride the Bitcoin Roller Coaster

Coinbase Global is going public just as enthusiasm for the digital currencies it trades is exploding. Investors should brace for a wild ride. Coinbase, which revealed its financials last week ahead of an anticipated direct listing, said it handled nearly $200 billion worth of trading in digital assets like bitcoin and ether last year, and stored or held in custody about 11% of the total market capitalization of crypto assets at the end of last year. Trading volume surged in the fourth quarter, nearly doubling from the third quarter. Coinbase earned $322 million in net income in 2020, versus a loss of $30 million in 2019. A lot of what Coinbase does today will be familiar to many financial investors: It is an exchange, a custodian, a retail brokerage, a prime brokerage, a digital wallet and more—but for crypto. For now, activity is predominantly monetized via individual customers who buy,…

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