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Coinbase to go public on 4/14

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Re: Coinbase to go public on 4/14

#61

Post by throwaway192874 »

loceng wrote: post #56
rory wrote: post #49

After not paying attention to cryptocurrency for a few years and then opening a Coinbase account earlier this year, I was SHOCKED how fast and easy everything was. From what I can discern as a user, they've made a great platform. My one worry-- it seems like they use a similar pattern to Robinhood where upon purchase they grant an asset immediately (synthetically?), and then settle up actual holdings after the fact.…

Interesting since the platform seems to go down, be unaccessible to users, most times that the price of Bitcoin starts to skyrocket - preventing many from impulse selling.

That's also the time when the system has to scale the most, so it's not exactly surprising to see this. Unfortunate and something that should be improved yes, but doesn't really support an argument of them trying to prevent people from selling since that is exactly when you'd expect the system to fall over.

Re: Coinbase to go public on 4/14

#62

Post by endisneigh »

sn_master wrote: post #42
endisneigh wrote: post #21

Under what circumstances would it make sense to invest in Coinbase compared to Bitcoin/underlying? Doesn't really make sense if you're bullish on crypto. Even seed investors who invested in Coinbase when it was founded would've been financially better off just buying Bitcoin/underlying. The situation here is unique because all of the popular coins have fixed supplies so any increase of popularity will have the commen…

CoinBase makes money through purchase and transfer fees even if the underlying crypto doesn't go up in value or even goes down. Mature coins no longer go up in value in double digits multipliers but their trade volume is bigger than ever because of the increased interest and online markets, be it the ones on (dark.fail) or Tesla. Your other choice to benefit from the increase in the trade volume is to setup your own…

If a coin stagnates in growth, why wouldn't you liquidate and put it into something else that's growing?

Re: Coinbase to go public on 4/14

#63

Post by diplodocusaur »

nwhatt wrote: post #2

If I were to invest $100 in some allocation of Coinbase stock and Bitcoin - what should the ratio be?

Funny. If you believe in bitcoin, then you would already have invested.

Otherwise what you (and many others, but not all) believe in as an investor is the possibility of a return from storing your dollars in bitcoin and retrieving the value later.

If you think this announcement would affect the price, look at price history data for the time of the announcement up to the date of going public. That could serve as some kind of signal given some model assumptions. Avoid confirming your own biases and establish your margin of risk as damage tolerance.

As I see it, betting on coinbase is betting on the volume of transactions increasing over time.

Re: Coinbase to go public on 4/14

#64

Post by endorphine »

endisneigh wrote: post #21

Under what circumstances would it make sense to invest in Coinbase compared to Bitcoin/underlying? Doesn't really make sense if you're bullish on crypto. Even seed investors who invested in Coinbase when it was founded would've been financially better off just buying Bitcoin/underlying. The situation here is unique because all of the popular coins have fixed supplies so any increase of popularity will have the commen…

I guess investing in Coinbase is like investing in Bitcoin _plus_ a lot of other cryptocurrencies. That's a subtle difference compared to investing _only_ in Bitcoin.

Also, Coinbase might come up with additional income sources in the future.

Re: Coinbase to go public on 4/14

#65

Post by sn_master »

endisneigh wrote: post #62
sn_master wrote: post #42

Earlier quoted context omitted.

CoinBase makes money through purchase and transfer fees even if the underlying crypto doesn't go up in value or even goes down. Mature coins no longer go up in value in double digits multipliers but their trade volume is bigger than ever because of the increased interest and online markets, be it the ones on (dark.fail) or Tesla. Your other choice to benefit from the increase in the trade volume is to setup your own…

If a coin stagnates in growth, why wouldn't you liquidate and put it into something else that's growing?

Because you need it to make purchases, just like a real world currency. When the Euro goes down, everyday people don't just liquidate all their holdings to USD, because USD isn't accepted in their countries. Take a look at dark.fail or the FBI statements, whenever they shutdown an onion market there is always hundreds of millions in BTC sales they uncover.

Without the dark web markets since The Silk Road in 2011, and now Tesla and big legal companies, coins would have no real purpose to exist. The hype alone isn't enough to keep them all this time and dark web markets aren't quick into adapting new coins each time. Many have ditched BitCoin to Monero only because of the privacy factor, not growth.

Re: Coinbase to go public on 4/14

#66

Post by tigger0jk »

rory wrote: post #49

After not paying attention to cryptocurrency for a few years and then opening a Coinbase account earlier this year, I was SHOCKED how fast and easy everything was. From what I can discern as a user, they've made a great platform. My one worry-- it seems like they use a similar pattern to Robinhood where upon purchase they grant an asset immediately (synthetically?), and then settle up actual holdings after the fact.…

I believe coinbase holds a lot of crypto - in the robinhood analogy, coinbase is their own clearing house. So they don't have to post collateral to themselves, but if crypto movement was all in one direction on a given day, they might rely on the market instead of the liquidity they themselves provide. Maybe in such a scenario they would be clever enough to NOT resolve all the trades instantly.

Re: Coinbase to go public on 4/14

#67

Post by endisneigh »

sn_master wrote: post #65
endisneigh wrote: post #62

Earlier quoted context omitted.

If a coin stagnates in growth, why wouldn't you liquidate and put it into something else that's growing?

Because you need it to make purchases, just like a real world currency. When the Euro goes down, everyday people don't just liquidate all their holdings to USD, because USD isn't accepted in their countries. Take a look at dark.fail or the FBI statements, whenever they shutdown an onion market there is always hundreds of millions in BTC sales they uncover. Without the dark web markets since The Silk Road in 2011, and…

The euro doesn't have a fixed supply so your comparison doesn't make any sense to begin with. A better comparison would be like a tree that produces fruit. Once you're at the maximum amount the tree can ever produce why wouldn't you harvest? There's no longer any reason to wait.

Re: Coinbase to go public on 4/14

#68

Post by rory »

tigger0jk wrote: post #66
rory wrote: post #49

After not paying attention to cryptocurrency for a few years and then opening a Coinbase account earlier this year, I was SHOCKED how fast and easy everything was. From what I can discern as a user, they've made a great platform. My one worry-- it seems like they use a similar pattern to Robinhood where upon purchase they grant an asset immediately (synthetically?), and then settle up actual holdings after the fact.…

I believe coinbase holds a lot of crypto - in the robinhood analogy, coinbase is their own clearing house. So they don't have to post collateral to themselves, but if crypto movement was all in one direction on a given day, they might rely on the market instead of the liquidity they themselves provide. Maybe in such a scenario they would be clever enough to NOT resolve all the trades instantly.

Got it, so in general, they are _actually_ fronting you the asset (although you can't take it out of their control until you've paid up), as opposed to an IOU.

Re: Coinbase to go public on 4/14

#69

Post by loceng »

throwaway192874 wrote: post #61
loceng wrote: post #56

Earlier quoted context omitted.

Interesting since the platform seems to go down, be unaccessible to users, most times that the price of Bitcoin starts to skyrocket - preventing many from impulse selling.

That's also the time when the system has to scale the most, so it's not exactly surprising to see this. Unfortunate and something that should be improved yes, but doesn't really support an argument of them trying to prevent people from selling since that is exactly when you'd expect the system to fall over.

Yes indeed that's an easy excuse for plausible deniability - yet this person I'm responding to has stated they've greatly improved speed, so why wouldn't they also have improved concurrency, redundancy, etc?

We recently know that Coinbase has had bad behaviour of manipulating the price and find a measly $6 million for market manipulation, so it seems not outside their character.

Re: Coinbase to go public on 4/14

#70

Post by sn_master »

endisneigh wrote: post #67
sn_master wrote: post #65

Earlier quoted context omitted.

Because you need it to make purchases, just like a real world currency. When the Euro goes down, everyday people don't just liquidate all their holdings to USD, because USD isn't accepted in their countries. Take a look at dark.fail or the FBI statements, whenever they shutdown an onion market there is always hundreds of millions in BTC sales they uncover. Without the dark web markets since The Silk Road in 2011, and…

The euro doesn't have a fixed supply so your comparison doesn't make any sense to begin with. A better comparison would be like a tree that produces fruit. Once you're at the maximum amount the tree can ever produce why wouldn't you harvest? There's no longer any reason to wait.

An actual use case would be If I am a drug dealer using XMR or BTC to buy and sell my stuff, even if the growth slows down, I can't switch to another coin unless the market does too.

Big amount of BTC trades happen in exchange for goods and services and often time switching coins isn't an option there.

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