Source: Bankless; Compiled by: Wuzhu, Golden Finance
Coinbase has been quietly laying the foundation for its most transformative year yet as a public company.
From its landmark S&P 500 inclusion to its ambitious derivatives expansion to its cutting-edge privacy initiatives, Coinbase seems determined to gain a foothold at the intersection of traditional finance and decentralized innovation.
Although the company's stock price has not been soaring, and it is still dealing with the impact of a major data breach, COIN continues to rise, up more than 50% in the past month.
In this article, we will analyze 10 key catalysts that will affect COIN's trajectory in 2025.
The S&P 500 is a broad market benchmark that programmatically weights the 500 largest U.S. public companies by market capitalization. It is the basis for trillions of dollars in passive and active investment strategies.
On May 19, Coinbase became the first crypto stock to be added to the index; the inclusion brought an estimated $15 billion in inflows to the stock, meaning that for every dollar that flows into an S&P 500-linked portfolio, about 0.11% is allocated to the crypto exchange.
While that number may not seem large, the sheer size of the index translates that into millions of dollars in monthly buys as investors allocate capital into passive strategies, a valuable support mechanism for Coinbase’s price and liquidity, and a sign of crypto’s growing connection to traditional finance.
Coinbase recently announced that it will acquire Deribit, the undisputed global leader in cryptocurrency options, for $2.9 billion ($700 million in cash and 11 million shares of COIN). The acquisition is the largest transaction in the cryptocurrency industry to date.
The transaction will enable Coinbase to offer options products to international and senior traders, as well as existing spot, futures and perpetual contract products, thereby transforming the exchange into a full-service cryptocurrency giant that provides savvy traders with all the tools they need to express their views on digital assets and commodity markets.
Options, with their built-in leverage, enable traders to trade larger notional dollar volumes per dollar of capital. The introduction of these tools will not only allow Coinbase to earn more fees, but will also create synergistic relationships that will boost the platform's overall trading volume.
Traditional financial markets may be closed on weekends, but the cryptocurrency market never closes. In order to adapt to this reality and meet the needs of traders in a "never-closed" market, Coinbase recently became the first exchange registered with the CFTC to provide regulated BTC and ETH futures market trading services 24/7.
By providing 24/7 leveraged futures contract trading services, Coinbase ensures that speculators and market makers can react at any time. Longer trading days mean more trades can be made, and the exchange's trading volume is expected to continue to grow.
Riot Games is a multi-billion dollar studio with popular games such as League of Legends and Valorant. Earlier this month, the company announced that it would partner with Coinbase to enter the digital asset field.
As the “exclusive cryptocurrency exchange and official blockchain technology partner” for Valorant and League of Legends esports global events, Coinbase will provide viewers with real-time analysis of currency movements during matches, as well as redeemable emote/icon “drops” for event viewers.
While this partnership is small in scale, it could be just the beginning of a multi-year relationship that could be lucrative for both parties, with Riot Games bringing in-game asset ownership to the blockchain with the help of Coinbase.
Ethena has become a blue-chip cryptocurrency protocol in this market cycle as its stablecoin products have attracted billions of dollars in deposits. These stablecoin products hold spot crypto assets and short perpetual futures to synthesize dollar exposure and generate income.
To participate, Coinbase Asset Management launched the "Bitcoin Income Fund" in late April, aiming to achieve 4-8% Bitcoin returns by adopting a basis trading strategy similar to Ethena.
Alternatives to Ethena are numerous, but few existing customers. The Coinbase Bitcoin Income Fund provides convenient returns to its institutional investors and offers better prices to buyers in the Coinbase futures/perpetual contract market by matching buyers with programmatic sellers.
The "Verified Pool" launched by Coinbase on March 18 uses its proprietary KYC verification system (Coinbase Verifications) to combine identity verification with decentralized exchanges by hooking up to Uniswap V4.
Such a pool could be useful (even if not necessary) for real-world asset swaps, and highlights the role of Coinbase’s existing KYC database in facilitating on-chain securities trading, especially in an era when the U.S. Securities and Exchange Commission (SEC) is committed to providing transparency into digital assets.
Coinbase Custody guards 12% of the total cryptocurrency market value and serves as the registered custodian for the vast majority of spot cryptocurrency ETFs on U.S. exchanges, including the mainstream BTC and ETH products offered by Grayscale and BlackRock.
Coinbase Custody supports more than 40 blockchains, covers hundreds of assets, seamlessly integrates custody staking capabilities, and supports DeFi participation through its Prime Onchain wallet. These two unique features set it apart from more traditional custody options, given that US banks have been approved to provide such services.
As institutional interest in digital asset ownership grows, Coinbase is well positioned to profit from the growing deposits in its fee-based custody service.
For many years, Coinbase has been committed to expanding its enduring "Services and Subscriptions" revenue segment, and one of its main ways to make money in this category is through Coinbase One. This is a retail-focused cryptocurrency subscription service that offers lower transaction fees, higher USDC rewards, and more.
In February of this year, Coinbase enhanced One's services to provide subscribers with a range of on-chain benefits, including $10 per month in Base Gas fees, free 5-digit Basename claims, and lower fees/token benefits from partner agreements.
Coinbase International has provided a range of perpetual futures linked to cryptocurrencies to eligible non-US users. While these tools have not yet been approved by the U.S. Commodity Futures Trading Commission (CFTC), the exchange has promised that this is the next type of derivative they hope to offer to U.S. users.
Perpetual futures contracts have no expiration date, and existing traders on Coinbase International can get up to 20x leverage. If these tools for retail users are approved by the U.S. Commodity Futures Trading Commission (CFTC), Coinbase may become a leading platform for leveraged trading of digital assets and commodities.
Cryptocurrency requires privacy. On March 6, Coinbase announced that it had hired the team behind Iron Fish, a zero-knowledge privacy layer that provides optional privacy protection for assets on transparent chains, to lead a new privacy team within Base and accelerate the implementation of the network's privacy strategy by developing privacy-preserving primitives.
While this collaboration is still in its infancy, it shows that Coinbase is committed to making Base a leader in private blockchain solutions for the benefit of developers, users, and the cryptocurrency industry.
If more and more institutions and individuals migrate to the chain, they will need to conduct some sensitive financial transactions that are not known to the public; Base can attract these users by becoming a leader in private blockchain solutions.
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