Coinbase to Buy $ 500 Million in Crypto and Invest 10% of All Future Profits in Digital Assets

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The leading US exchange in terms of trading volume, Coinbase, has revealed plans to add half a billion dollars in crypto to its balance sheet.

Coinbase CEO Brian Armstrong announced that the company’s board of directors approved the crypto spending craze in an August 20 tweet, adding that Coinbase also plans to invest 10% of all profits generated in digital assets in the future.

Armstrong also indicated that the company hopes to increase the percentage of profits it allocates to cryptocurrency purchases over time.

We recently received board approval to purchase over $ 500 million worth of crypto on our balance sheet to add to our existing holdings. And we will invest 10% of all profits in the future in crypto. I expect this percentage to continue to increase over time as the crypto economy matures.

Brian Armstrong (@brian_armstrong) August 19, 2021

A blog post published by Coinbase the same day announces that the move will make the exchange the first publicly traded company to hold Ether, DeFi and Proof-of-Stake assets on its balance sheet.

The announcement emphasizes Coinbases’ commitment to making long-term investments in the crypto industry, stating:

Our investments will be continuously deployed over a multi-year window using an average cost dollar strategy. We are long-term investors and will only sell in certain circumstances, such as delisting an asset from our platform.

The publication adds that future investments can be informed by the holdings of its customers, suggesting that Coinbase may add an asset to its balance sheet if users make large custodial deposits of a given cryptocurrency.

Coinbase will conduct its transactions on third party platforms or through its OTC trading desk to avoid creating conflicts of interest with its customers.

According to Crypto Treasuries, Coinbase is currently the eighth largest public company in possession of Bitcoin on its balance sheet, and the largest crypto exchange by value of BTC held in its treasury.

Related: Coinbase Creates Account Takeover Hotline

The news of the new crypto spending comes just a day after Coinbase completed its Japanese launch in partnership with Mitsubishi UFJ Financial Group (MUFG). Coinbase will also have access to Mitsubishi’s customer base of around 40 million customers under their deal, according to the announcement.

On the same day, Coinbase also announced that it had amassed a $ 4 billion war chest to prepare for regulatory spending and the upcoming crypto winter.

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