When Coinbase was founded in 2012, the cryptocurrency industry was just a new bud that many believed would blossom but couldn’t say precisely how it would happen. Fast forward to six years later, and the San-Francisco based cryptocurrency exchange has become one of the largest channels through which many former crypto skeptics are joining the train.
For instance, according to Coinbase data shared on Twitter by Alistair Milne, the exchange got five million new users in just five months (from March 2018 till September).
Coinbase Growth Update:
– added ~5million users in the last 6 months, now have 25mil
– average of ~25,000 users/day is comparable to mid-2017
Data here: http://t.co/R9B63J2d6Q#bitcoin pic.twitter.com/MITLacwC5L
— Alistair Milne (@alistairmilne) October 3, 2018
Coinbase experienced mild growth during its early years when cryptocurrencies were not as popular as they are today. Data from the chart revealed that the exchange had less than 5 million users after four years in the crypto industry.
In 2017, however, Coinbase started recording significant growth, and the number of users skyrocketed to 15 million in that year alone, a figure which is twice the number in the last four years. The exchange continued to grow by leap and bounds and currently boasts of 25 million users and is now averaging 25,000 daily active users.
How Did It Happen?
This massive growth in the number of users was recorded during a period when the crypto industry started receiving a lot of attention. The reason behind this tremendous growth is not far-fetched. Buying Bitcoin in the US is a difficult task, and Coinbase made itself a gateway for millions of Americans to get into the fascinating world of cryptos.
While many other big exchanges like Binance support only crypto-to-crypto pairs, Coinbase is known as the most popular exchange for converting fiat to crypto. New investors would likely have to convert their fiat to Bitcoin or Ether before trading for other cryptos. Hence, they turn to Coinbase since the exchange offers this service despite ridiculously high fees.
With only a linked bank account, new users can purchase some of the most popular cryptocurrencies including BTC, BCH, ETH, and LTC with ease. This has made the exchange a favorite among those new to crypto trading.
Coinbase’s fiat-crypto service, user-friendly interface, and loads of offerings are the main reasons why the exchange has become one of the most important and successful companies in the crypto space.
Coinbase Nears $8 Billion Valuation
While Coinbase user numbers continue to add up nicely, the exchange is reportedly close to securing a $500 million investment from New York-based Tiger Global.
If Coinbase can get this deal over the line, then it will become one of the most valued startups in the U.S with an $8 billion valuation achieved in just six years in a new industry.
These are fascinating times for Coinbase and one that will have a significant effect on the cryptocurrency industry. The larger the exchange gets, the easier it becomes for it to convert new users and this is just what the industry needs.
The growth of Coinbase will likely be crucial for the growth of the industry, and right now, even though crypto is still far from real mass adoption, Coinbase’s dominance is worth keeping an eye out on.