Coinbase is buying $500 million in crypto and investing future profits into a crypto portfolio – CNBC

Coinbase is buying $500 million in crypto and investing future profits into a crypto portfolio – CNBC

The logo for Coinbase Global Inc, the biggest U.S. cryptocurrency exchange, is displayed on the Nasdaq MarketSite jumbotron and others at Times Square in New York, U.S., April 14, 2021.

Shannon Stapleton | Reuters

Coinbase will buy $500 million in crypto on its balance sheet and allocate 10% of its quarterly profits into a crypto assets portfolio, company executives announced late Thursday.

The company plans to invest in “Ethereum, Proof of Stake assets, DeFi tokens, and many other crypto assets supported for trading on our platform,” becoming the first public company to do so, finance chief Alesia Haas said in a blog post.

CEO Brian Armstrong first revealed the brokerage’s plans in an earlier tweet, saying he expects the allocation to grow as the market matures. He also indicated the company’s ambitions to diversify its crypto services and operations, which mostly center around trading.

“Hopefully over time we can operate more of our business in crypto,” Armstrong said on Twitter. “Today it is still a mix.”

The price of bitcoin climbed higher on the news, passing $47,000 on Friday after sitting below $45,000 the previous two days. Coinbase shares rose more than 3% higher in early trading Friday.

The few companies that have included bitcoin in their holdings, like Microstrategy and Tesla (with the help of Coinbase), have done so as a hedge against inflation and potential devaluation of the U.S. dollar.
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