Since Amazon Web Services (AWS) is one of the most popular cloud service providers on the planet, it is not surprising that the US-based cryptocurrency exchange Coinbase is trying to capitalize on its success by developing its own cloud infrastructure solutions Now, Coinbase Cloud.
“We want to be the AWS of encryption,” Said Surojit Chatterjee, Coinbase’s chief product officer, said in an exclusive interview with Forbes. “We are building the entire Coinbase Cloud product suite, which you can think of as an encrypted computing service to help developers build their applications faster.”
Before becoming Coinbase Cloud, the service was named Bison Trails, which is a cloud-based staking infrastructure solution. Coinbase purchased earlier this year The amount is undisclosed and is rumored to be more than 80 million U.S. dollars. According to Coinbase, Bison Trails is a non-custodial platform, which means it does not manage customers’ mortgage assets.
Amazon Web Services (AWS) was once a secondary consideration for Amazon in Seattle, and it was overshadowed by Amazon. Nevertheless, the Amazon subsidiary, which debuted nearly 20 years ago, is now the company’s main profit engine. AWS’s annual operating income in 2020 is 13.5 billion U.S. dollars, with a revenue base of 45.3 billion U.S. dollars, accounting for 63% of its parent company’s total revenue.
Coinbase officials suggested that they need to become the “cryptocurrency Amazon” as soon as possible.Most of its honor is not because it is the first major digital currency business to go public, but because it has achieved The greatest direct listing in historyTherefore, its revenue stream is overly dependent on transaction fees.
This is usually the case for line items that are dominated by revenue concentration in a single category. For example, Facebook and Google rely almost entirely on advertising to make money. Therefore, their line items usually have this level of revenue concentration.
However, due to their heavy reliance on the market and overall trading volume, Coinbase and other exchanges may be very vulnerable. Since trading volume is closely related to price fluctuations, this dependence may be the main disadvantage of crypto platforms such as Coinbase or any other exchange.
Coinbase is seeking to reduce this risk by providing subscription services that are more resistant to market fluctuations to increase transaction revenue. For example, it provides institutional custody services, the possibility of mortgages, a learning portal that provides users with encryption as a reward, an e-commerce checkout system, and the ability to issue Visa debit cards to customers. It also tried a subscription plan that would provide customers with a monthly transaction allowance at a fixed price.
Chatterjee stated that the acquisition of Bison Trails is a key step in Coinbase’s transition to a more mature financial system. The platform supports crypto custodians, funds, decentralized applications and token holders. Some of its clients are Andreessen Horowitz (a16z), New York-based fintech companies Current and Turner Sports.
As of November 2021, Coinbase Cloud has pledged $30 billion in crypto assets on its platform. Coinbase is one of the most popular cryptocurrency platforms, with more than 73 million real customers, 10,000 organizations, and 185,000 ecosystem partners in more than 100 countries.According to Coinbase, since its inception, it has deal with The transaction value exceeds 700 billion U.S. dollars.