Shares of cryptocurrency exchange Coinbase are up nearly 4% on Friday after the stakes were raised with its cash pile. CEO Brian Armstrong revealed on Twitter that Coinbase has received the green light from the board to buy more than USD 500 million in cryptocurrencies. The digital assets will be added to the balance sheet to bolster Coinbase’s existing crypto portfolio.
Armstrong didn’t stop there. Coinbase will also be directing 10% of its bottom line to cryptocurrencies with plans to increase the allocation “as the crypto economy matures,” he noted. Coinbase’s boss wants to integrate cryptocurrencies more deeply into the company’s operations, as currently it is run on a combination of fiat money and crypto.
Bitcoin, Ethereum, Proof of Stake and DeFi
Armstrong further explained that the exchange’s crypto exposure will be determined by their users by “matching [Coinbase’s] crypto custodial balances.” In addition to bitcoin, Coinbase is buying Ethereum and other coins tied to popular market themes. The announcement stated,
“This means we will become the first publicly traded company to hold Ethereum, Proof of Stake assets, DeFi tokens, and many other crypto assets supported for trading on our platform, in addition to bitcoin, on our balance sheet.”
Market participants cheered the development, though Galaxy Digital chief Mike Novogratz was quick to point out that his firm “has been doing all this in Canada since 2018.”
Coinbase isn’t the only U.S. company to gain exposure to bitcoin on the balance sheet. MicroStrategy, which is run by BTC bull Michael Saylor, holds more than 100,000 bitcoins, worth greater than USD 4 billion based on the latest price, in its treasury.
Jack Dorsey’s payments company Square has also been buying thousands of bitcoins and has 5% of its balance sheet in BTC. Not to be outdone, Elon Musk’s Tesla doled out USD 1.5 billion for bitcoin recently. Musk also expects that the EV maker will resume accepting bitcoin as a payment method again once the cryptocurrency’s carbon footprint is reduced. His space venture, SpaceX, also owns some bitcoin.
Coinbase shares are inching closer to the USD 260 threshold, which the stock touched on during Friday’s session but retreated somewhat.
For the month of August so far, Coinbase’s stock is up 8% on the heels of solid quarterly results. According to traders on social media, the setup for Coinbase shares is looking good.
This article was originally posted on FX Empire