Coinbase kicks up hiring, citing institutional demand
Institutional traders turn up when the markets turn down.
Coinbase Institutional is planning to expand its current operations from about 20 people to 150 in the coming months, said general manager Adam White to CoinDesk, in the face of steady and growing demand from institutional traders.
"When we saw the market begin to correct, which we all expected, institutions didn't lose interest," he said. "It was exactly the opposite. They look at it as an opportunity to enter when things are not too frothy."
This trend has been seen all around the cryptosphere, but Coinbase might be more ready to capitalise on it than most.
First, it naturally has deeper pockets than its smaller competitors, which is funding the ongoing hiring. Second, it's very much part of Coinbase's wider plan of covering all bases and becoming the destination for anything and everything related to cryptocurrency and digital assets.
With the right coverage of all bases, retail interest can fill Coinbase's pockets when markets go up, and institutional interest can do the same when markets go down – and making the most of that means hiring hard.
Striking while the iron's hot
Financial institutions are moving towards cryptocurrency very quickly themselves. Established names on Wall Street, including Goldman Sachs, Nasdaq, Intercontinental Exchange, Morgan Stanley and many more, are all champing at the bit to various degrees in their keenness to meet client demand for crypto exposure.
And all of them are wrestling with how best to handle this new techno-money. Coinbase is there as a solution for them.
"We want to partner with appropriate institutions to help the whole ecosystem grow," said Coinbase Institutional head of sales Christine Sandler. "It's not 'institutional or retail,' because a lot of these institutions will be distributors."
A twin effect of hiring away this top talent might also be to put a damper on the movements of Coinbase's competitors. Coinbase Institutional's location in New York might also help.
The area's "an incredibly deep pool of talent," White said. "We have to create a bridge between financial services and technology... In order to do that, we need to pull from some of the best and brightest minds that have worked their whole careers in other kinds of traditional financial firms."
The ongoing brain drain from Wall Street to crypto alley has left some concerned, but it has showed no signs of abating. If anything, it might be picking up and bringing both industries closer together.
It's another strangely appropriate parallel to the situation following the global financial crisis, which gave birth to bitcoin, when concerns around Wall Street brain drain were last out in force in light of talk of pay caps for Wall Street executives.
And that situation might also be worth learning from. The crypto industry is still flush with money after the run-up to 2018, which has left the big names able to poach talent which would typically be well beyond the reach of such young companies. Is the fledgling crypto industry setting itself up to get kicked in the teeth if the gravy train starts drying up?
It might also be worth considering what the ongoing wave of Wall Street transplants see in crypto, and what the breakdown is of those in it for the money, the technology and the ideology. Coinbase aims to build a bridge between crypto and traditional finance, but for better or worse, a bridge runs both ways.
Disclosure: At the time of writing, the author holds ETH, IOTA, ICX, VET, XLM, BTC and ADA.