A well-known cryptocurrency exchange might have become one of the largest “banks” in the United States if the crypto platform is classified as a financial institution. This is an intriguing thought brought up by its top executive. Coinbase CEO Brian Armstrong made a fascinating assumption about the cryptocurrency exchange’s potential rank if it is considered as a bank, saying that Coinbase would be the 21st largest American bank in terms of total assets.
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Among The Largest Banks
Armstrong tickled the minds of his X account followers after claiming that Coinbase would easily be one of the major banks in the country if it was categorized as such because of its assets.
The Coinbase executive made the statement in light of the cryptocurrency firm’s impressive financial growth, which has resulted in an estimated asset value of $420 billion.
“If you think of Coinbase like a bank, we now hold about $0.42T in assets for our customers, which would make us 21st largest bank in the US by total assets, and growing,” Armstrong said in a post.
On the other hand, the crypto executive believed that if Coinbase would be seen as a brokerage, the cryptocurrency exchange would be definitely among the 10 largest in the country.
“If you think of us more like a brokerage, we’d be the 8th largest brokerage today by AUM,” the Coinbase CEO said, a post that aroused the thoughts of his followers.
Coinbase And The Payment Sector
Meanwhile, Armstrong admitted that if the crypto exchange was ranked in the payment sector, he would be clueless about Coinbase’s position in the industry, saying, “If you think of us like a payments company…TBH I’m not sure where we rank on that list.”
The crypto executive said that he cannot pinpoint Coinbase’s place in the ranking because “there are various ways to measure it.” However, he pointed out the huge volume of stablecoin payments that the crypto platform was able to process last year.
“There were about $30T in total stablecoin payments last year (not all of those were goods and services though),” he said in a post.
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Blurring The Lines
Armstrong explained that he raised these thought-provoking statements to emphasize that the delineation between these categories is no longer that clear, saying that “with crypto, the line between these categories is blurring.”
“There are many legacy reasons these are separate in the traditional financial system – and not all of them are good reasons. Why does the money you spend lose value instead of growing in value like an investment? Why does your checking account not earn yield like a savings account (or better yet, like short term treasuries),” the Coinbase executive said.
He argued that investors turn to Coinbase not only to invest, but also to use the platform to spend, get a loan, and others.
“In the updated financial system, you will have a single primary financial account which serves all these functions. A greater % of global GDP will run on more efficient crypto rails over time. We’ll have sound money, lower friction transactions, and greater economic freedom for all,” he concluded.
Featured image from WIRED, chart from TradingView
