Coinbase

Company information

• Date founded: 2012
• Industry: Financial technology; financial services
• Corporate headquarters: San Francisco, California
• Type: Public

Overview

Coinbase is a publicly traded financial services and financial technology company based in San Francisco, California. The company operates a secure platform that allows users to trade and store cryptocurrencies. By 2025, Coinbase’s wallet feature supported thousands of digital assets, including Bitcoin, Dogecoin, Ethereum, and Litecoin. Coinbase went public through a direct listing in April 2021, and its shares trade on the Nasdaq stock exchange.

In addition to its core cryptocurrency brokerage services, Coinbase has operated advanced trading platforms, including the Global Digital Asset Exchange (GDAX), later Coinbase Pro, and Coinbase Advanced, and expanded into derivatives trading, stablecoin services, payment tools, and institutional financial products. Institutional traders used GDAX to complete cryptocurrency transactions, while retail traders use the Coinbase brokerage platform. Coinbase earns revenues by charging brokerage fees on cryptocurrency transactions, which range from approximately 1.5 to 4 percent. It also generates income by leveraging the mid-market price spread between the GDAX and retail transaction environments.

The company was established in 2012, while cryptocurrencies and cryptocurrency trading were in their infancies. It was co-founded by entrepreneur Brian Armstrong and investor Fred Ehrsam. Armstrong continued to serve as Coinbase’s chief executive officer (CEO) during the 2020s. Ersham remained on the Coinbase board of directors but expanded his business interests to become a managing partner of Paradigm, an investment firm focused on the cryptocurrency sector.

Statistics from the Coinbase website indicated that the company had more than 4,900 employees, $294 billion in assets on platform, and $202 billion in quarterly trading volume. The company’s global user base extended across more than 100 countries and included more than $273 billion in assets on platform, while maintaining a daily trade volume of $14 billion.

History

In 2008, the Bitcoin cryptocurrency was created by an unidentified individual or group operating under the pseudonym Satoshi Nakamoto. Its arrival was announced in a whitepaper titled “Bitcoin: A Peer-to-Peer Electronic Cash System.” Bitcoin and other cryptocurrencies use a technology known as blockchain, which uses a novel storage system to structure data into small blocks, with each block building on earlier blocks to segment the transmission of information across internet-connected networks. When applied to digital currencies, blockchain technologies permit the decentralized and anonymous passage of financial value between end users. New cryptocurrencies continually emerged in the 2010s and 2020s, moving the novel financial technology slowly toward the mainstream.

Recognizing the revolutionary potential of cryptocurrencies, Armstrong founded Coinbase in 2012 with the support and assistance of Ersham. Prior to founding Coinbase, Armstrong had worked as a consultant at the professional services firm Deloitte and as a software engineer at the Airbnb peer-to-peer property rental network. Ersham had spent two years working as a trader for the Wall Street financial services firm Goldman Sachs after graduating from Duke University in 2008.

The company’s user base began to grow rapidly in the autumn of 2013, when the value of Bitcoin surged from under $200 in October 2013 to more than $1,150 the following month. From September 2013 to October 2014, the number of unique Coinbase users increased from 277,000 to 1.7 million. It continued to steadily increase leading up to the Bitcoin boom of late 2017, which saw the cryptocurrency’s value soar from under $1,000 in December 2016 to more than $13,000 by year-end 2017. Other leading cryptocurrencies, including Ethereum and Litecoin, saw similar increases in their value, touching off a flurry of interest in the emerging sector of the economy. By the first quarter of 2018, Coinbase had built a customer base of approximately 23 million users. Bitcoin’s value crossed $60,000 in 2021, swelling Coinbase’s user community to more than 68 million members.

Analysts covering Coinbase’s stock initial public offering (IPO) in April 2021 speculated that the company’s share price and market capitalization would mirror the dramatic boom-and-bust cycles seen in the value of major cryptocurrencies like Bitcoin. Throughout its history, Bitcoin and other cryptocurrencies have gone through regular cycles of dramatic price appreciation and depreciation. For example, Bitcoin’s market price swung from approximately $600 in September 2016 to $17,000 in January 2018, only to retreat to about $3,180 in December 2018 before surging over $60,000 in April 2021.

In June 2022, Coinbase laid off nearly 20 percent of its workforce as the cryptocurrency market took a downturn. A few months later, Coinbase partnered with BlackRock, an investment company. In October, the company collaborated with Google Cloud, allowing customers to pay for cloud services using cryptocurrencies supported by Coinbase Commerce. In 2023, the US Securities and Exchange Commission sued Coinbase for operating without properly registering as a securities exchange, broker, and clearing agency and for failing to register its staking-as-a-service program.

Impact

Coinbase has grown to become one of the world’s leading cryptocurrency exchanges. It competes with hundreds of other similar platforms, but has built a large and growing global user base that includes thousands of institutional investors. These features have made Coinbase a major player in the increasingly high-profile world of cryptocurrency trading. Coinbase also became a custodian for several US spot Bitcoin exchange-traded funds introduced in 2024. Though cryptocurrency prices are subject to abrupt and dramatic price swings, Bloomberg placed their combined market value at $2.48 trillion in 2021. The collapse of several cryptocurrency firms, including FTX, increased regulatory scrutiny of digital asset exchanges.

However, cryptocurrency’s volatile but highly profitable market value and unregulated nature have made it a favorite target for cybercriminals. Before 2025, Coinbase stressed that its platform had never suffered a major, sustained security breach, but in 2025 the company disclosed that criminals bribed overseas support agents to steal customer data for social engineering attacks. An ABC News report published in May 2021 documented two examples of cybercrime that victimized Coinbase users. In one instance, a customer lost cryptocurrencies valued at approximately $500,000 after a sophisticated cybercrime network duped him into sharing his account authentication details. In another, a couple lost $170,000 after their Coinbase account was targeted by hackers. Both users complained about Coinbase’s transparency and customer service standards, arguing that the company lacks adequate cybersecurity and does little to help users whose accounts have been breached.

Coinbase was also the subject of a polarizing episode during the lead-up to the 2020 US presidential election. In September 2020, in response to the politically charged events of the previous summer that saw widespread protests and rioting in major US cities, Armstrong authored a blog post that was critical of employees imposing their political views on the workplace. Armstrong argued that the politicization of the workplace distracts companies from pursuing their core objectives, prompting a walkout among Coinbase employees who were strongly supportive of the activist organization Black Lives Matter (BLM). Armstrong later invited employees who disagreed with his position to leave the company, offering compensation to those who elected to do so. According to an article published in Fortune magazine the following month, approximately 5 percent of Coinbase’s workforce accepted exit packages and left their jobs.

Bibliography

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DeCambre, Mark. “Coinbase IPO: Everything You Need to Know about the ‘Watershed Moment’ in Crypto.” MarketWatch, 14 Apr. 2021, www.marketwatch.com/story/coinbase-ipo-everything-you-need-to-know-about-the-watershed-moment-in-crypto-11618350086. Accessed 21 May 2026.

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“Our Mission is to Increase Economic Freedom in the World.” Coinbase, www.coinbase.com/mission. Accessed 21 May 2026.

Pinkerton, Julie. “The History of Bitcoin.” U.S. News & World Report, 2 Sept. 2025, money.usnews.com/investing/articles/the-history-of-bitcoin. Accessed 21 May 2026.

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Roberts, Jeff John. “Coinbase Sees 5% of Employees Depart in Wake of Politics Controversy.” Fortune, 8 Oct. 2020, fortune.com/2020/10/08/coinbase-employees-depart-politics-controversy. Accessed 21 May 2026.

Walser, Adam. “Cryptocurrency Accounts Wiped Out ‘In an Instant’ by Cyber Crooks.” Tampa Bay 28, 19 May 2021, www.abcactionnews.com/news/local-news/i-team-investigates/cryptocurrency-accounts-wiped-out-in-an-instant-by-cyber-crooks. Accessed 21 May 2026.