{"id":116084,"date":"2019-10-24T16:54:40","date_gmt":"2019-10-24T16:54:40","guid":{"rendered":"https:\/\/cryptoslate.com\/?p=116084"},"modified":"2019-11-07T05:58:53","modified_gmt":"2019-11-07T05:58:53","slug":"coinbase-generated-more-operating-profit-from-transaction-fees-than-vc-money","status":"publish","type":"post","link":"https:\/\/cryptoslate.com\/coinbase-generated-more-operating-profit-from-transaction-fees-than-vc-money\/","title":{"rendered":"Coinbase generated more operating profit from transaction fees than VC money"},"content":{"rendered":"<div id=\"contents\">\n<p class=\"c4\"><span class=\"c11\">Coinbase, one of the largest cryptocurrency exchanges in the U.S., has generated nearly $2 billion from transaction fees alone since its launch in 2012, CEO Brian Armstrong said. In an interview with Vanity Fair, Armstrong said the exchange generated more operating profit than all of the venture capital money it raised throughout the years.<\/span><\/p>\n<h2 id=\"h.cj1oeld192bp\" class=\"c1\"><span class=\"c7\">Coinbase CEO says the exchange has been profitable for three years<\/span><\/h2>\n<p class=\"c4\"><span class=\"c3\">While the crypto industry has long been seen as a sort of a &#8220;wild west&#8221; environment where everything and anything goes, the truth is that succeeding in the industry isn't as easy as it sounds. This is especially true in developed western countries such as the U.S., where regulatory scrutiny often stifles innovation and growth.<\/span><\/p>\n<figure id=\"attachment_110466\" aria-describedby=\"caption-attachment-110466\" style=\"width: 300px\" class=\"wp-caption alignright\"><a href=\"https:\/\/cryptoslate.com\/coinbase-added-5-million-new-users-in-the-last-10-months\/\"><img loading=\"lazy\" decoding=\"async\" class=\"size-medium wp-image-110466\" src=\"https:\/\/cryptoslate.com\/wp-content\/uploads\/2019\/07\/coinbase-users-social-300x158.jpg\" alt=\"Coinbase added 5 million new users in the last 10 months\" width=\"300\" height=\"158\" srcset=\"https:\/\/cryptoslate.com\/wp-content\/uploads\/2019\/07\/coinbase-users-social-300x158.jpg 300w, https:\/\/cryptoslate.com\/wp-content\/uploads\/2019\/07\/coinbase-users-social-768x403.jpg 768w, https:\/\/cryptoslate.com\/wp-content\/uploads\/2019\/07\/coinbase-users-social-1024x538.jpg 1024w, https:\/\/cryptoslate.com\/wp-content\/uploads\/2019\/07\/coinbase-users-social.jpg 1200w\" sizes=\"(max-width: 300px) 100vw, 300px\" \/><\/a><figcaption id=\"caption-attachment-110466\" class=\"wp-caption-text\">Related: <a href=\"https:\/\/cryptoslate.com\/coinbase-added-5-million-new-users-in-the-last-10-months\/\">Coinbase added 5 million new users in the last 10 months<\/a><\/figcaption><\/figure>\n<p class=\"c4\"><span class=\"c9\">However, one exchange has defied all odds and saw\u00a0<\/span><span class=\"c0\"><a class=\"c2\" href=\"https:\/\/cryptoslate.com\/coinbase-added-5-million-new-users-in-the-last-10-months\/\">growth<\/a><\/span><span class=\"c9\">\u00a0that was unprecedented in the industry\u2014<\/span><span class=\"c0\"><a class=\"c2\" href=\"https:\/\/cryptoslate.com\/companies\/coinbase\/\">Coinbase<\/a><\/span><span class=\"c3\">.<\/span><\/p>\n<p class=\"c4\"><span class=\"c9\">Founded in 2012, when its founder\u00a0<\/span><span class=\"c0\"><a class=\"c2\" href=\"https:\/\/cryptoslate.com\/people\/brian-armstrong\/\">Brian Armstrong<\/a><\/span><span class=\"c3\">\u00a0pitched the company and struck deals at cafes, it is now one of the largest cryptocurrency exchanges in North America. The company's goal, Armstrong said, is to make crypto a widely accepted and utilized resource.<\/span><\/p>\n<p class=\"c4\"><span class=\"c3\">And it seems to be working well for them.<\/span><\/p>\n<p class=\"c4\"><span class=\"c9\">Onstage on Vanity Fair's New Establishment Summit, Armstrong\u00a0<\/span><span class=\"c0\"><a class=\"c2\" href=\"https:\/\/www.vanityfair.com\/news\/2019\/10\/brian-armstrong-confirms-coinbase-is-profitable?utm_source=twitter&mbid=social_twitter&utm_medium=social&utm_brand=vf&utm_social-type=owned\">said<\/a><\/span><span class=\"c3\">\u00a0that the company has been profitable for the past three years, a rare feat in an industry where venture capital and promises of a better future keep struggling companies afloat.<\/span><\/p>\n<p class=\"c4\"><span class=\"c3\">While the company did raise serious capital, Armstrong claims that it was nothing compared to the operating profit it managed to generate on its own. The exchange reportedly generated almost $2 billion in transaction-fee revenue since it launched.<\/span><\/p>\n<h2 id=\"h.vhh7mpozjo79\" class=\"c1\"><span class=\"c7\">Coinbase is an anti-unicorn unicorn<\/span><\/h2>\n<p class=\"c4\"><span class=\"c3\">A large part of these profits was invested back into the business to create new products, Armstrong said. He explained:<\/span><\/p>\n<blockquote>\n<p class=\"c4\"><span class=\"c3\">&#8220;I sort of think of us as the anti-unicorn unicorn&#8230;I want Coinbase to be a company of repeatable innovation.&#8221;<\/span><\/p>\n<\/blockquote>\n<p class=\"c4\"><span class=\"c3\">In the venture capital industry, the term unicorn is used to describe a startup, usually based in tech, that has reached a $1 billion valuation. And while chasing the unicorn status seems to be the ultimate goal for most young companies, Armstrong didn't seem too concerned about it.<\/span><\/p>\n<p class=\"c4\"><span class=\"c9\">He said that he &#8220;just likes to build products with technology,&#8221; which is why he leaves the valuation to the investors. Nonetheless, Coinbase received an\u00a0<\/span><span class=\"c0\"><a class=\"c2\" href=\"https:\/\/cryptoslate.com\/cryptocurrency-exchange-giant-coinbase-valuing-itself-at-8-billion\/\">$8 billion valuation<\/a><\/span><span class=\"c3\">\u00a0last year, making it one of the most highly-valued companies in crypto.<\/span><\/p>\n<p class=\"c4\"><span class=\"c9\">Armstrong's focus on the product rather than bureaucracy can also be seen in the company's\u00a0<\/span><span class=\"c0\"><a class=\"c2\" href=\"https:\/\/cryptoslate.com\/facebooks-cryptocurrency-libra-whitepaper-reveals-blockbuster-partnerships\/\">involvement<\/a><\/span><span class=\"c3\"> with <a href=\"https:\/\/cryptoslate.com\/coins\/libra\">Libra<\/a>. He seemed puzzled by the negative reactions Libra got both in the media and the U.S. government, saying that it was an area of innovation that should be embraced by the U.S.<\/span><\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>Coinbase, one of the largest cryptocurrency exchanges in the U.S., has generated nearly $2 billion from transaction fees alone since its launch in 2012, CEO Brian Armstrong said. In an interview with Vanity Fair, Armstrong said the exchange generated more operating profit than all of the venture capital money it raised throughout the years. Coinbase [&hellip;]<\/p>\n","protected":false},"author":106,"featured_media":116094,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[39,35372],"tags":[],"post_folder":[],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v21.9 (Yoast SEO v21.9.1) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Coinbase generated more operating profit from transaction fees than VC money<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/cryptoslate.com\/coinbase-generated-more-operating-profit-from-transaction-fees-than-vc-money\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Coinbase generated more operating profit from transaction fees than VC money\" \/>\n<meta property=\"og:description\" content=\"Coinbase, one of the largest cryptocurrency exchanges in the U.S., has generated nearly $2 billion from transaction fees alone since its launch in 2012, CEO Brian Armstrong said. In an interview with Vanity Fair, Armstrong said the exchange generated more operating profit than all of the venture capital money it raised throughout the years. Coinbase [&hellip;]\" \/>\n<meta property=\"og:url\" content=\"https:\/\/cryptoslate.com\/coinbase-generated-more-operating-profit-from-transaction-fees-than-vc-money\/\" \/>\n<meta property=\"og:site_name\" content=\"CryptoSlate\" \/>\n<meta property=\"article:published_time\" content=\"2019-10-24T16:54:40+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2019-11-07T05:58:53+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/cryptoslate.com\/wp-content\/uploads\/2019\/10\/coinbase-tx-fees.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"1200\" \/>\n\t<meta property=\"og:image:height\" content=\"630\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"Priyeshu Garg\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@cryptoslate\" \/>\n<meta name=\"twitter:site\" content=\"@cryptoslate\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Priyeshu Garg\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"2 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"NewsArticle\",\"@id\":\"https:\/\/cryptoslate.com\/coinbase-generated-more-operating-profit-from-transaction-fees-than-vc-money\/#article\",\"isPartOf\":{\"@id\":\"https:\/\/cryptoslate.com\/coinbase-generated-more-operating-profit-from-transaction-fees-than-vc-money\/\"},\"author\":{\"@type\":\"Person\",\"@id\":\"https:\/\/cryptoslate.com\/author\/priyeshu-garg\/#person\",\"name\":\"Priyeshu Garg\",\"url\":\"https:\/\/cryptoslate.com\/author\/priyeshu-garg\/\",\"mainEntityOfPage\":{\"@id\":\"https:\/\/cryptoslate.com\/author\/priyeshu-garg\/\"},\"image\":{\"@type\":\"ImageObject\",\"@id\":\"https:\/\/cryptoslate.com\/author\/priyeshu-garg\/#authorimage\",\"url\":\"https:\/\/cryptoslate.com\/wp-content\/uploads\/2020\/08\/author-priyeshu-garg-300x300.jpg\",\"contentUrl\":\"https:\/\/cryptoslate.com\/wp-content\/uploads\/2020\/08\/author-priyeshu-garg-300x300.jpg\",\"caption\":\"Priyeshu Garg\"},\"jobTitle\":\"Analyst\",\"description\":\"Priyeshu is a software engineer who is passionate about machine learning and blockchain technology. 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He holds an engineering degree in computer science engineering and is a passionate economist. He built his first digital marketing startup when he was a teenager, and worked with multiple Fortune 500 companies along with smaller firms. When he is not solving transportation problems at his company (Ola), he can be found writing about the blockchain or roller skating with his friends.","url":"https:\/\/cryptoslate.com\/author\/priyeshu-garg\/"}]}},"_links":{"self":[{"href":"https:\/\/cryptoslate.com\/wp-json\/wp\/v2\/posts\/116084"}],"collection":[{"href":"https:\/\/cryptoslate.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/cryptoslate.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/cryptoslate.com\/wp-json\/wp\/v2\/users\/106"}],"replies":[{"embeddable":true,"href":"https:\/\/cryptoslate.com\/wp-json\/wp\/v2\/comments?post=116084"}],"version-history":[{"count":4,"href":"https:\/\/cryptoslate.com\/wp-json\/wp\/v2\/posts\/116084\/revisions"}],"predecessor-version":[{"id":116096,"href":"https:\/\/cryptoslate.com\/wp-json\/wp\/v2\/posts\/116084\/revisions\/116096"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/cryptoslate.com\/wp-json\/wp\/v2\/media\/116094"}],"wp:attachment":[{"href":"https:\/\/cryptoslate.com\/wp-json\/wp\/v2\/media?parent=116084"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/cryptoslate.com\/wp-json\/wp\/v2\/categories?post=116084"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/cryptoslate.com\/wp-json\/wp\/v2\/tags?post=116084"},{"taxonomy":"post_folder","embeddable":true,"href":"https:\/\/cryptoslate.com\/wp-json\/wp\/v2\/post_folder?post=116084"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}