There had been rumors circulating that Coinbase had added support for RIpple’s XRP. Brian Armstrong, CEO of Coinbase, made it crystal clear that his company had not decided to add support for any more coins right now. He further added, “Any statement to the contrary is untrue and not authorized by the company”.
It would make sense to add Ripple’s XRP to Coinbase since it’s the second largest crypto, but if the company feels that it’s not yet ready then it should not add it. It’s always better to be fully prepared to handle something rather than hastily getting involved in it. After all, it will be the company that will have to deal with the consequences should things go wrong.
Coinbase Not Supporting More Digital Assets
Coinbase currently offers support for bitcoin, bitcoin cash, litecoin, and ethereum. According to its recent blog post, the crypto exchange company will not be adding any other assets for the time being. The company also mentions that an internal team of qualified experts review and determine which assets should be added with the criteria for adding assets being shared publicly by the company in a write up called the Digital Asset Framework.
With so many new cryptocurrencies and blockchain platforms rising quickly in value and popularity, it’s understandable that Coinbase would need more time to carefully evaluate if they should offer support for another crypto. As most people are aware by now, Ripple’s XRP replaced Ethereum’s ETH to become the 2nd largest cryptocurrency in terms of market capitalization but other coins like TRON, Cardano, and Stellar have also made it into the list of top 10 cryptocurrencies, so there is a lot for Coinbase to consider.
Rapid Growth & Changes
Again, these changes to the crypto-market are happening at such a frantic pace, that anyone would require more time to react, especially a large exchange like Coinbase. It seems like, in a blink of an eye, the crypto-market grows by billions of dollars. At the time of writing, the total crypto-market cap is around $765 billion (CoinMarketCap). There are many things that need to be taken into consideration when a cryptocurrency exchange, like Coinbase, makes the decision to add support for a particular crypto or digital asset. For instance, will their current system be able to accommodate all the potential buy and sell orders? Coinbase has been growing and learning just like the entire crypto-community. It has already experienced major outages, because it couldn’t handle the insane amount of crypto-trading taking place on its platform. Also, Coinbase has come under the scrutiny of the IRS due to a conflict between the company’s privacy policies and the demands of the IRS. It was a hard fought battle, which took considerable time and effort to resolve.
It’s always good to learn from the past. Doing the same thing over and over again and expecting different results is insanity. So, Coinbase might just be doing the right thing here. One thing to note here is that Coinbase’s decisions have a lot of power in the cryptosphere. How? When the company announced it won’t be offering support for Ripple (indirectly), Ripple’s price fell by 20%. Similarly, the price of bitcoin cash skyrocketed after the company announced it would be supporting it. However, the company had their work cut out for them, because they had to halt operations and conduct an investigation due to allegations of insider trading. So now, Coinbase seems to be treading more cautiously, which could serve them well in the long run.