The CEO of Coinbase believes that the transaction fee-based revenue model will not work in the long run.

Brian Armstrong. source: a video screenshot. CNBC / YouTube

The crypto exchange large Coinbase desires to ditch its reliance on group action fees as its main supply of financial gain – and worries that the fees that traders pay once they exchange tokens cannot offer a property type of income.

Speaking in an interview with CNBC, the firm’s chief operating officer Brian Armstrong stated:

• "Commercialism fees should continue to be a major part of our business in 10 years. Even twenty years from now. however I’d wish to get to an area wherever over 50% of our revenue [comes from] subscriptions and services.”

By “subscriptions and services,” Armstrong was pertaining to paid Coinbase services, premium membership packages, staking, rewards programs, and therefore the like.

As recent monetary results have proved, exchanges like Coinbase bring in eye-watering profits once crypto costs rise, however it tends to induce laborious when prices stagnate and commercialism volumes drop.



As such, Coinbase now not desires to trust therefore heavily on creating fodder when the market sun shines and toughing it out through prolonged crypto winters. Its chief operating officer claimed that the firm was “investing these days most in subscription and services revenue” and extra that “a number” of recent services-related merchandise were presently “in the works.”

Armstrong’s would like is also slowly returning true: whereas commercialism fee-derived financial gain has taken a battering, Coinbase’s latest quarterly monetary report did have a subscription and services-themed silver lining. This a part of the firm’s income has big in size and currently represents some 18% of Coinbase’s revenue. solely a year prior, that figure was simply 4%.

however the cold winds of crypto winter don't seem to be the sole threat to Coinbase’s dreams of success. Regulators still apply pressure on the company, and a legal battle with the Securities and Exchange Commission (SEC) continues to be a definite possibility. The SEC might probe the firm over suspicions that several of the tokens Coinbase lists are securities. If this proves to be the case, Coinbase might notice itself on the hook for facultative the sale of such tokens.

however Armstrong place a positive spin on the restrictive issue, stating:

• "I think it's positive that we've been collaborating with the regulatory authorities. And our overall goal is basically to help drive restrictive clarity on a worldwide scale.”

On the topic of crypto winter, he perennial his mantra that business was “never nearly as good because it seems” and “never as dangerous as it seems.”


Armstrong concluded:

• "I think one of the reasons Coinbase has been successful over the last ten years is [that] we try not to get fixated on little ups and downs," says the founder of Coinbase."

Meanwhile, Coinbase has discovered that the payments supplier PayPal has joined its Travel Rule compliance platform, the Travel Rule Universal answer Technology (TRUST) network.

The Travel Rule is that the production of the monetary Action Task Force (FATF) and has been enshrined into law in multiple nations. It wrongfully needs exchanges and alternative crypto intermediaries to relay sender knowledge on high-value, inter-platform transactions.