The American startup firm Coinbase which is fondly called ‘the AOL of Bitcoin’, is finally starting its operations in UK for the first time.
Coinbase is the bitcoin wallet and platform financed with more than $100 million from investors like DFJ, NYSE and Andreessen Horowitz and has more than 2.7 million consumer accounts. Starting from today, English customer will be able to top up the company’s bitcoin wallet with pounds apart from US dollars. Speculation by the financial traders on the price of the bitcoin against pounds and euros will also be possible through Coinbase. CEO Brian Armstrong stated that the company is aspiring to start operations in 40 countries by the end of 2015.
Founded in 2012, Coinbase has won recognition and support now among the bitcoin establishment but also among the tech industry. Early this year, the company successfully raised $75 million in its third round of fundraising, valuing the firm to be $400 million, making it the biggest of any bitcoin firm. More than the money, it is the credibility and reliability of the company that makes the investors invest on Coinbase. Large US banks, Japanese phone company DoCoMo and the New York Stock Exchange funded the company in its Series C funding round. Now the company serves throughout the bitcoin economy.
The launch is UK is a boost and encourage plans to convert UK into Global hub for digital currencies by making use of the opportunity that lies in the recent moves by the government and Bank of England to permit more bitcoins to flow through Britain. “Armstrong explained, “The interest in the UK is at a different level than it is elsewhere in Europe. We got the sense that the demand there was really high and London is a financial capital of the world, so it was a logical next step.” He also added, “I would say that regulation is more favorable in the UK right now. I have to give a lot of credit to UK regulators. They have been very forward thinking about bitcoin.”
With the expansion of the exchange services to Britain, Fred Ehrsam, co-founder of Coinbase forecasts the customer base will be “a healthy combination of regular everyday people, high-net-worth individuals and then a few hedge fund guys, few institutional guys. Over time, that shifts more and more towards larger institutional players.”
Armstrong suggested that the exchange may become one of the highest revenue generating among the businesses in UK. Coinbase is segregated into three pillars – between a consumer wallet, a developer’s platform for APIs and an exchange where investors can trade bitcoin for the major currencies like euro, dollar etc. While most of the companies tend to focus on one either exchange or platform or consumer wallet, Coinbase has been working on strategies to focus on all three of its product lines making it an ecosystem.
In the US, Coinbase took care of bitcoin payments for ten companies and generated a revenue of more than $1 billion last year. “I can throw out other numbers which are interesting too: our consumer wallet growth is 10x in the last year and despite the price going up or down our core metrics around user sign-ups, deposits of bitcoin and so on, continue to grow at a good rate. Maybe more interesting is merchant activity..that graph looks great.”
It is this capability of the company to expand an older niche product into the mainstream that has won the company the tag of ‘AOL of Bitcoin.’ Like how the proto-ISP pulled millions online, Coinbase is believed to have the capability to move millions to outside from the conventional financial ecosystem.