Coinbase, a global cryptocurrency exchange platform, witnessed unprecedented growth in the institutional market in the first quarter of 2021. As of December 31, 2020, the platform's institutional holdings have grown 170%, from $ 45 billion at the end of. Q2020 122 to $ 2021 billion at the end of QXNUMX XNUMX.
Its unstoppable growth is driven by cryptocurrencies
Coinbase currently serves over 8.000 institutional clients, including hedge funds, wealth managers, corporations, pensions and endowments. Many of these institutional clients leverage Coinbase Custody, a secure offline storage solution built around the best-in-class key generation protocol to protect wallets. Additionally, Coinbase Custody offers an industry-leading insurance policy to provide additional reassurance to investors.
Since its inception in 2018, Coinbase Custody has seen a growing trend among all types of institutional investors looking to capitalize on the value of cryptocurrencies. Coinbase Custody supports over 90% of cryptocurrencies by market capitalization and has seen a flurry of crypto-ETPs in recent months as investors have sought to gain affordable exposure to the market via proxies. Independent industry research compiled by leading analytics provider Apex: E3 supported this trend, showing 132.594 bitcoins were bought by institutional investors globally in the first quarter.
"We are extremely proud of Coinbase Custody"
Drew Robinson, Coinbase's Head of Hedge Fund Sales, says, “Over the past 12 months, we've seen a growing interest from institutional investors looking to leverage the crypto space. However, this year, the interest of pension funds and hedge funds has skyrocketed, supported by the launch of crypto-ETPs and a greater understanding of the crypto economy.
“Over time we have seen a variety of factors that have dragged institutional investors into space; these range from hedging against inflation, to diversifying corporate balance sheets and the desire for wider involvement in the digital economy, including sectors such as payments, payroll and cross-border payments. Customer demand is also playing a significant role.
“We are extremely proud of Coinbase Custody, which is built on industry-leading security backed by third-party insurance. In addition to providing a compliant and secure custody solution, customers also have access to network participation and delegated proof of participation. It is this best-in-class solution that has led to our wealth growth and we look forward to working with more partners as the institutional market develops. "
Alternatives to Coinbase
Those who want to enter the world of cryptocurrencies, but without actually buying them, can do so through trading platforms such as Bitcoin system. With this software it is possible to trade cryptocurrencies, without actually owning them. The advantage? It is the fact that it is possible to earn regardless of whether their value goes up or down. However, since the market is very volatile, it would be good to invest only money that you can afford to lose.