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08.11.17

Coinbase Joins Unicorn Club with $100 Million Funding, Partners with Fidelity

Digital currency wallet Coinbase has taken the leap to become a unicorn, writes Finovate (Paybefore’s sister company). The San Francisco-based company has received $100 million in Series D funding led by IVP.

Other investors include Spark Capital, Greylock Partners, Battery Ventures, Section 32 and Draper Associates.

The investment brings the company’s total funding to $217 million; Pitchbook estimates Coinbase is now valued at $1.6 billion. This makes the company one of only a handful of unicorns (startups with more than $1 billion valuations) in fintech and crowns Coinbase as the first bitcoin unicorn.

Since it was founded in 2012, Coinbase has exchanged more than $25 billion worth of digital currency for its clients. Almost $15 billion of this occurred in the first half of 2017 alone.

The company plans to put the new funds to work in three ways. First, Coinbase plans to expand its engineering and customer support teams. Second, it will open a GDAX office in New York City to better position itself to serve professional traders. Third, it will invest in the digital currency Toshi to build it into a global payments network.

Coinbase, which supports bitcoin, Ethereum, and Litecoin in 32 countries, offers three main products:

  • Coinbase: an exchange platform for digital currency;
  • GDAX: exchange platform for professional U.S. traders and institutions;
  • Toshi: a browser for the Ethereal network.

The company notes that with this funding, it’s preparing to transition into phase three of its “secret master plan,” that is, it plans to build a consumer interface for decentralized digital currency apps.

The 5-year-old company announced a pilot integration with Western Union and added support for Litecoin earlier this year. It also launched its open source, combination messaging app and ethereum wallet, Token, in the spring.

Among the company’s investors are Andreessen Horowitz, Draper Fisher Jurvetson (DFJ), and Bank of Tokyo-Mitsubishi.

Brian Armstrong is co-founder and CEO.

Partnership with Fidelity 

The innovation division of Fidelity Investments, Fidelity Labs, has released a new balance-viewing feature for investors in partnership with Coinbase.

The move may be a small step for Fidelity brokerage clients who want to see their digital currency assets alongside their other investments. But it’s an interesting sign from a company that helped drive mass adoption of and investment in another revolutionary asset class—mutual funds—more than two decades ago.

The view-balance feature was tested on Fidelity employees with digital currency accounts at Coinbase earlier this year, Project Manager Kristen Stone writes in the Coinbase blog. The popularity of the feature led Fidelity to expand the offering to all its customers, which Stone calls a testament “to the continued commitment of traditional financial institutions to adopt digital assets and widen access for customers.”

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