Coinbase has officially launched its custody service for institutional clients. Due to the digital nature of the crypto assets, a specialized service for storing them safely was in demand, and Coinbase move in custody service is supposed to fill this gap. According to Sam Mcingvale product lead “Coinbase Custody is a combination of Coinbase’s battle-tested cold storage for crypto assets, an institutional-grade broker-dealer and its reporting services, and a comprehensive client coverage program.”
Coinbase says that its custody service will have unique features like “On-chain segregation of crypto assets,” “offline,multi-sig and geographically distributed transaction protection” besides having a robust cold storage, auditing, and reporting.
Coinbase has already been a custodian of $ 20 billion worth of crypto assets in the past six years, and this custody offering will be secured through SEC and FINRA regulated Electronic transaction clearing.
The service as of now will be limited to Europe and US and is expected to arrive in Asia before the end of this year. The currency available will be similar to the ones offered through coinbase.com, and more coins will be added, so expect ethereum classic to arrive as soon as it is available for trading through coinbase.com.
Features like hot wallets, scheduled withdrawals will also be added after obtaining regulatory clearance
The service as of now requires a minimum of $10 million worth of digital assets and a $100,000 initiation fees. According to coinbase around $10 billion worth of institutional money waiting on the sidelines will enter in the crypto market due to the introduction of this service.
Coinbase has been quite active recently in terms of launching services. It recently started an index fund last month for “US-accredited” investors and has revealed plans to open its service for Japanese investors.
Coinbase Index funds are now open to investors with a minimum investment of $250,000 with a cap of $20 million. The index fund will track cryptos which are listed in its subsidiary GDAX. The fund will hold Bitcoin, Ethereum, Bitcoin cash and Litecoin as of now and proportion of the individual’s assets will be based on the weighted average by market capitalization.
Index holdings will change in future when more assets are added in the GDAX exchange, for instance, Ethereum classic which will be added in the index in the Q4 2018.
Asiff Hirji, president & COO at Coinbase announced the possibility of Coinbase becoming a fully regulated broker-dealer, pending approval by federal authorities. After its recent announcement of the Coinbase suite of institutional products, the intention of the move is clear, i.e., Coinbase will soon be a major force to reckon in the cryptocurrency space and probably be like Goldman Sachs of 21st century. The Goldman Sachs comment is because of the following comment in the blog
“Ultimately, we can envision a world where we may even work with regulators to tokenize existing types of securities, bringing to this space the benefits of cryptocurrency-based markets — like 24/7 trading, real-time settlement, and chain-of-title. We believe this will democratize access to capital markets for companies and investors alike, lowering costs for all participants and bringing additional transparency and inclusion to the ecosystem.”
Streamlabs which is a broadcasting app for Twitch users has now introduced cryptocurrency tips. The backend of the payment gateway will be done by Coinbase, and thus the initial choice of the coin will be restricted to Bitcoin, Bitcoin cash, Ethereum, and litecoin. There won’t be any charges for using the app other than the network transaction fees of the respective coins. Also, the Broadcasters will have to link there account to coinbase rather than just giver there public keys for the respective coins. The blog does mention that in future it will be adding more coins.
According to the NewZoo, market intelligence provider, streamlabs accounted for 15 percent of total twitch viewing hours in the first quarter of 2018. Steamlabs reported in April that they processed about $35 mln in tips in the 2018 Q1.