Coinbase buys Earn.com, appoints its CEO as Coinbase CTO
The $120 million-odd deal is Coinbase's most significant acquisition to date.
Coinbase has made no secret of its plans to become the "Google of blockchain" by pursuing a concentrated merges and acquisitions strategy similar to that employed by Alphabet Inc. If Coinbase has one problem, it might be a lack of talent to fill its own ranks and its newly acquired shoes, TechCrunch reports.
Its most recent acquisition of Earn.com hits two birds with one stone. As well as acquiring the product, Coinbase is bringing (former) Earn.com CEO Balaji Srinivasan on as its new chief technical officer (CTO). The exact price tag of this deal is unknown, but TechCrunch estimates the $120 million range based on the amount Coinbase has recently raised from investors.
Srinivasan is widely known in Silicon Valley as an early cryptocurrency evangelist, while Earn.com itself is recognised as one of a handful of companies that has managed to usefully and profitably build an entirely new product based on cryptocurrency.
"Balaji has become one of the most respected technologists in the crypto field and is considered one of the technology industry’s few true originalists," Coinbase announced. "As CTP of Coinbase, Balaji will serve an important role as the technological evangelist for the company. Balaji will evangelise for both crypto and for Coinbase, educating the world and recruiting crypto-first talent to the company."
"In addition to welcoming Balaji, we’re also very pleased to welcome the Earn.com team to Coinbase. Earn allows senders to pay users in cryptocurrency to reply to emails and complete tasks. We’re going to be doubling down on the Earn business within Coinbase, as they have built a paid email product that is arguably one of the earliest practical blockchain applications to achieve meaningful traction."
The idea of paying users to answer emails isn't that different from the paid surveys which have quickly spread around the Internet, but the cryptocurrency twist adds a new and more useful element, facilitating micropayments anywhere in the world and letting the company reach a much wider sample.
"Empirically, we find that Earn.com senders get 30–70% response rates within 24 hours for $1–10 incentives, even for messages with many thousands of recipients. This is extraordinarily high relative to the typical 1.7% response rates for cold emails," it says.
Srinivasan also notes that its ability to reach out to certain groups, with a high rate of response, has made Earn.com a useful tool in many areas, giving the example of quizzing AI engineers about their next career move, or expectations around how the industry will mature.
"Every once in a while, a company comes along that is the start button for a technology," Srinivasan said. "If you control and build that onboarding process, then you can build everything else downstream. If you do it right, then Coinbase goes from the place people build cryptocurrency to the place where blockchain technology is built."
One of the most touted features of cryptocurrency has been to cut banks out of the money transfer equation. The initial application of this was mostly cheap peer to peer payments. But it also works for businesses, letting tech companies move into banking-style services and start offering their own payment solutions. The scope of blockchain systems is broad, and Coinbase might be well-angled to head to the front of the pack on both the financial and other applications of distributed ledger technology.
Disclosure: At the time of writing the author holds ETH, IOTA, ICX, VEN, XLM, BTC, NANO
- Expert analysis: Ethererum’s price is consolidating, not stagnating
- Bitcoin price drops as US hikes interest rates – are they connected?
- 4 tips to streamline your Australian cryptocurrency tax in 2021
- Bitcoin up 21%: Will El Salvador’s big news kick off a fresh bull run?
- Ethereum drops 13% but experts are convinced good news around the corner