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Coinbase holds bitcoin and altcoins on its own balance sheet

Updated: Aug 31, 2024
Published: Feb 25, 2021
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Cryptocurrency exchange Coinbase revealed that it has been holding bitcoin and other cryptocurrencies as investments on its balance sheet since 2012.

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Brett Tejpaul, the Head of Institutional Sales, Trading, Custody, and Prime Services at Coinbase made these revelations in a blog post.

Bitcoin treasury

Coinbase added that its plans to maintain its investments in cryptocurrencies as it believes in their long-term potential.

Since our founding in 2012, Coinbase has held bitcoin and other crypto assets on our balance sheet — and we plan to maintain an investment in crypto assets as we believe strongly in the long-term potential of the cryptoeconomy,” wrote Tejpaul.

However, Coinbase did not specify how much they have invested in bitcoin and other cryptocurrencies.

This seems to be the first time that the exchange has publicly disclosed its investments in cryptoassets. It may not come as a surprise to many people because it is a cryptocurrency exchange and its core business is crypto assets.

The exchange ended up developing investment, accounting, and tax policies to handle its balance sheet that contains crypto investments.

Coinbase said that it is happy if others can benefit from its experience.

A business opportunity

The revelation couldn’t have come at a better time for the exchange as major companies, both public and private, seem to have an appetite for converting a portion of the balance sheet into bitcoin.

Institutions across the board are building for a future that is protected from new risks,” said Tejpaul.

“This includes building a diverse balance sheet that is adequately hedged from the traditional capital markets and monetary debasement,” he continued.

This address to other corporations also emphasizes the complications that companies can face when investing in bitcoins.

Cryptocurrencies are no longer just being used as investment assets but for much more. 

“On the corporate side, use cases for digital assets are expanding rapidly from traditional portfolio management as an investment asset within a diversified portfolio — to accounts receivable/accounts payable, employee payroll, and commerce integration, for example.”

Coinbase has the capacity

Tejpaul said that the exchange has “executed nine and ten-figure trades for some of the largest institutions in the world,” although he did not give names.

Coinbase has helped Tesla and MicroStrategy buy bitcoins, and these two companies alone have spent more than $3.5 billion for the purchases.

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