Coinbase acquires Paradex decentralised exchange, rebrands GDAX
Coinbase is making moves to corner the market, with an ERC20 hub and crypto financial services.
Coinbase has paid an unknown amount for the Paradex exchange and is rebranding its professional GDAX platform as Coinbase Pro, Forbes reports. In the grand scheme of Coinbase's aspirations to become the "Google of cryptocurrency," these moves are part of a recent framework that's seeing it efficiently spread across all market segments.
The company was founded as a super simple combined bitcoin wallet and exchange for the everyday retail user, while its GDAX exchange was aimed at more sophisticated traders. Then it introduced an OTC trading counter for institutions and high net-worth individuals, and now it's acquiring a decentralised ERC20-focused exchange, Paradex, to better move on the global market that demands high security and decentralisation in its trading.
As some of Coinbase's competitors have said, neither centralised nor decentralised exchanges are inherently better, they're simply different services for different needs. Offering both is essential for any company with Google-esque market-cornering aspirations.
In the coming weeks, Paradex will be integrated into
GDAX Coinbase Pro, introducing a range of new features. Current GDAX customers will continue to see their current balance as well as everything else, and the change will mostly just look like a roll-out of new features.
It will also introduce a wide range of ERC20 Ethereum-standard tokens soon. But initially these will only be available for customers outside the USA. Those in the country will continue to be barred from the range of ERC20 tokens pending regulatory clearance. The main Coinbase platform will just continue to operate with its limited range of tokens in the near future.
It's expected that GDAX and Coinbase Pro will operate in parallel until 29 June, after which all customers will be switched over to Coinbase Pro and the freshly added Paradex features.
With a combination of Coinbase's core platform,
GDAX Coinbase Pro, Paradex and the Coinbase OTC service, the company might be well positioned to serve just about anyone who wants to buy or sell crypto.
With the framework of the tent set up around most conceivable customer niches, barring the exotic coin enthusiasts and regulatory ineligible, Coinbase is also working on filling that tent with concentrated financial service goodness.
One of the more notable examples is its investment in the Compound project, made just hours after the creation of Coinbase's venture capital arm (Coinbase Ventures). Compound is designed to facilitate the development of Ethereum-based financial services through some nifty programming frameworks as well as peer-to-peer lending, borrowing and earning of compound interest with crypto assets. You can see why Coinbase would be interested, especially now that it's acquired Paradex with an eye towards ERC20s.
With deliberate coverage of the market, and an eye towards actual crypto financial services rather than just coin dealing, Coinbase is clearly cementing its position as a company to watch.
Disclosure: At the time of writing, the author holds ETH, IOTA, ICX, VEN, XLM, BTC and NANO