Cryptocurrency exchange platform Coinbase Global Inc. will invest $500 million on cryptocurrencies with a commitment to invest 10% of its quarterly earnings on the same assets moving forward, the company said in a blog post.
- Coinbase said the investment will include Ethereum, proof-of-stake assets, decentralized finance tokens, and other crypto assets on its platform. This is on top of Bitcoin that is already on its balance sheet.
- The allocation will be based on the investment strategy of customers, as it will depend on the aggregate custodial crypto balances on the platform. Investments will be deployed using a dollar-cost averaging strategy.
- The investments will be long-term and will only be divested under special conditions such as the delisting of an asset on its platform. Trades will be made through its over-the-counter desk in an effort to avoid conflict of interest.
- Coinbase opened the door for allocations to be increased over time, with the belief that more firms will increase their crypto asset holdings. Most of the company’s corporate financial transactions are done in fiat currency.
Coinbase is optimistic that its investment in crypto assets would increase investor appetite for the crypto economy. COIN is up 4.08%, BTC up 6.74%, ETH up 8.14%.