$COIN Coinbase Global Inc Deep Dive and 2024 Outlook

Is the rise in Bitcoin a good entry for the long term?

Coinbase is a secure online platform for buying, selling, transferring, and storing cryptocurrency, and it is the largest cryptocurrency exchange in the United States by trading volume. The company was founded in 2012 and has since become a leading platform in the cryptocurrency space, offering services to both retail and institutional investors.

Coinbase generates revenue through several streams:

Transaction Fees: Users pay fees for buying and selling cryptocurrencies on the platform. These fees vary based on the transaction amount and the payment method used.

Spread: Coinbase charges a spread, which is the difference between the price at which you buy or sell an asset on their platform and the price Coinbase pays to fill the order.

Coinbase Pro and Prime: These are premium services designed for experienced traders and institutions, offering advanced trading features and additional services.

Custodial Services: Coinbase offers custodial services to institutional clients, charging fees based on the value of the assets under management.

Staking: Users can earn rewards by participating in the proof-of-stake consensus mechanism of certain cryptocurrencies, with Coinbase taking a commission from the staking rewards.

Interest Income: Coinbase earns interest on customers' custodial funds and from corporate interest income.

Other Services: This includes revenue from crypto-asset sales revenues and other corporate interest income

The most important questions for Coinbase are:

1. How will evolving regulations around cryptocurrency in the US and globally impact Coinbase's operations and growth?

2. How quickly will institutional investors adopt cryptocurrency, and how will this impact Coinbase's transaction volume and revenue?

3. What are the long-term prospects for Coinbase given new ETFs in the space?

4. Can Coinbase diversify its revenue streams to be less reliant on trading fees?

5. Can Coinbase capture a significant share of this institutional business?