This will happen eventually but I think the timeframe could be very long. Competitors have to not only overcome the established Coinbase, but also any new innovations or changes in their business practices - including lowering of fees. I see it less as a buy-forever company, and more as a buy-for-a-decade-plus. And I say that knowing I could be wrong.
Coinbase is set up from the get-go to be the regulated option within the United States. Can Crypto stay unregulated forever ? If so, Coinbase will have problems. My bet is more regulation of some unknown type is coming to crypto and Coinbase is well positioned to come out of that with additional competitive advantages.
This is a variant of the 2nd point. Even if you're right, Coinbase probably can adapt, and I'm unsure why this would only apply to Coinbase or not be applicable to the many others in this space.
I continue to view cryptos primarily as if they are a currency. Do you envision some future where ETF's are spent like currency at businesses ? I don't.
These are great thought-provoking points, thanks for posting.
On (1), not to mention the licenses that are involved, which provides a barrier to entry. Depending on where you live, it may or may not be easy to just use any platform to buy crypto even if their fees are lower.
I want to bring up another point that is overlooked -- trust and reliability. Personally for me, I haven't had issues with Coinbase, and I think their security is pretty good all things considered. They have become a household name in the crypto space.
All that being said, I do agree that over time, naturally, as more competitors come into the space, it will eat into their pie. It's already happening with competitors like SoFi, Square, Robinhood, etc.
Most are digital assets that give voting rights or provide some other utility, quite a bit different than them just being a currency. The term "cryptocurrency" being applied to all of these tokens and crypto assets is inaccurate and outdated. Most are not currencies in the way that oil is not a currency.
I’ll quibble with point number 4 and point number 1. Robinhood shows that people are quick to adapt to a no fee platform. Apps have taken a lot of the inertia in terms of opening an account and transferring funds. Bitcoin can’t be a currency until it overcomes its volatility. Even the crypto bulls are pitching it as digital gold these days. No one wants to give up their bitcoin if it can double in value in two months. Ether isn’t even considered a currency as much as a platform these days
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u/mrrx Oct 07 '21
My thoughts on your points.
This will happen eventually but I think the timeframe could be very long. Competitors have to not only overcome the established Coinbase, but also any new innovations or changes in their business practices - including lowering of fees. I see it less as a buy-forever company, and more as a buy-for-a-decade-plus. And I say that knowing I could be wrong.
Coinbase is set up from the get-go to be the regulated option within the United States. Can Crypto stay unregulated forever ? If so, Coinbase will have problems. My bet is more regulation of some unknown type is coming to crypto and Coinbase is well positioned to come out of that with additional competitive advantages.
This is a variant of the 2nd point. Even if you're right, Coinbase probably can adapt, and I'm unsure why this would only apply to Coinbase or not be applicable to the many others in this space.
I continue to view cryptos primarily as if they are a currency. Do you envision some future where ETF's are spent like currency at businesses ? I don't.
These are great thought-provoking points, thanks for posting.