<h4><b>One of the key features of blockchain technology is decentralization. The idea here is to rule out a single point of failure. However, recent research showed that Coinbase has custody of a big amount of $BTC. </b></h4> 
<p>In the unlikely case that Coinbase would get hacked, we could have a serious black swan event at our hands. They’re custodians for at least four big entities. <span style="font-weight: 400;">So, let’s see, who picked Coinbase as their $BTC custodian.</span></p> 
<h5><b>Why Pick Coinbase as Your $BTC Custodian?</b></h5> 
<p><span style="font-weight: 400;">Well, crypto custodians have become a regular household in the crypto sector. However, few custodians can hold huge amounts of $BTC. Coinbase is one of the few that can hold such enormous amounts. </span><span style="font-weight: 400;">This results in various reasons why Coinbase is a popular choice. So, let’s take a look at these.&nbsp;</span></p> 
<ul> 
 <li><b>Regulatory pressure</b><span style="font-weight: 400;"> — The current US government is not very crypto-friendly. Although, that’s almost an understatement. The SEC keeps going after various crypto firms, even though they already lost a few cases. You can also argue that there’s a lack of clear regulation coming from the SEC.&nbsp;</span></li> 
 <li><b>Fewer crypto-friendly banks</b><span style="font-weight: 400;">. — The US government has taken down plenty of crypto-friendly smaller banks. This is one of the main features of </span><a href="https://coinmarketcap.com/academy/article/operation-choke-point-2.0-the-third-crypto-war" target="_blank" rel="noopener"><span style="font-weight: 400;">Choke Point 2.0</span></a><span style="font-weight: 400;">. As a result, there are fewer options available.</span></li> 
 <li><b>Self-custody</b><span style="font-weight: 400;"> — This would be a good option but carries certain risks. For example, private key management.&nbsp;</span></li> 
</ul> 
<p><span style="font-weight: 400;">Here are various big entities that use Coinbase as their $BTC custodian. This totals 2.2 million $BTC that Coinbase looks after. That’s more than 10% of the total $BTC supply. See the picture below.</span></p> 
<p><img decoding="async" class="aligncenter wp-image-150221 size-large" src="https://www.altcoinbuzz.io/wp-content/uploads/2024/09/FireShot-Pro-Webpage-Capture-549-Sani-I-TimechainIndex.com-@SaniExp-_-X-x.com_-1024x552.jpg" alt="Coinbase" width="696" height="375" srcset="https://www.altcoinbuzz.io/wp-content/uploads/2024/09/FireShot-Pro-Webpage-Capture-549-Sani-I-TimechainIndex.com-@SaniExp-_-X-x.com_-1024x552.jpg 1024w, https://www.altcoinbuzz.io/wp-content/uploads/2024/09/FireShot-Pro-Webpage-Capture-549-Sani-I-TimechainIndex.com-@SaniExp-_-X-x.com_-300x162.jpg 300w, https://www.altcoinbuzz.io/wp-content/uploads/2024/09/FireShot-Pro-Webpage-Capture-549-Sani-I-TimechainIndex.com-@SaniExp-_-X-x.com_-768x414.jpg 768w, https://www.altcoinbuzz.io/wp-content/uploads/2024/09/FireShot-Pro-Webpage-Capture-549-Sani-I-TimechainIndex.com-@SaniExp-_-X-x.com_-780x420.jpg 780w, https://www.altcoinbuzz.io/wp-content/uploads/2024/09/FireShot-Pro-Webpage-Capture-549-Sani-I-TimechainIndex.com-@SaniExp-_-X-x.com_-696x375.jpg 696w, https://www.altcoinbuzz.io/wp-content/uploads/2024/09/FireShot-Pro-Webpage-Capture-549-Sani-I-TimechainIndex.com-@SaniExp-_-X-x.com_-1068x575.jpg 1068w, https://www.altcoinbuzz.io/wp-content/uploads/2024/09/FireShot-Pro-Webpage-Capture-549-Sani-I-TimechainIndex.com-@SaniExp-_-X-x.com_.jpg 1424w" sizes="(max-width: 696px) 100vw, 696px"></p> 
<p style="text-align: center;"><em>Source: <a href="https://x.com/SaniExp/status/1830720769996759342/photo/1" target="_blank" rel="noopener">X</a></em></p> 
<h5><b>1) $BTC spot ETFs and ETPs</b></h5> 
<p><span style="font-weight: 400;">There are 17 <a href="https://www.altcoinbuzz.io/?s=btc+spot+etf" target="_blank" rel="noopener">$BTC spot ETF</a> and ETP firms that use Coinbase as their custodian. Fidelity is the only $BTC fund that currently has self-custody. ETPs are Exchange Traded Products. Plenty of companies that offer them also use Coinbase as custodian. They total 806,619 $BTC.</span></p> 
<p><img decoding="async" class="wp-image-150264 aligncenter" src="https://www.altcoinbuzz.io/wp-content/uploads/2024/09/cddsfgfdtyt-300x192.png" alt="" width="537" height="344" srcset="https://www.altcoinbuzz.io/wp-content/uploads/2024/09/cddsfgfdtyt-300x192.png 300w, https://www.altcoinbuzz.io/wp-content/uploads/2024/09/cddsfgfdtyt.png 397w" sizes="(max-width: 537px) 100vw, 537px"></p> 
<h6 style="text-align: center;"><strong>Source: <a href="https://x.com/tayvano_/status/1831545351272378550?ref_src=twsrc%5Etfw" target="_blank" rel="noopener">X</a></strong></h6> 
<h5><b>2) MicroStrategy and CEXes</b></h5> 
<p><span style="font-weight: 400;"><a href="https://www.altcoinbuzz.io/?s=microstrategy" target="_blank" rel="noopener">Microstrategy</a> is only one of a few firms that have their $BTC in Coinbase’s custody. Tesla and SpaceX do so as well. MicroStrategy has 79,296 $BTC in custody. All three have 99,091 $BTC in custody. For CEXes, Coinbase, Revolut, and Bitvavao have 1,105,318 $BTC in custody.</span></p> 
<p><img decoding="async" class="wp-image-150265 aligncenter" src="https://www.altcoinbuzz.io/wp-content/uploads/2024/09/csdvsdfvtgrytuy-300x271.jpg" alt="" width="520" height="470" srcset="https://www.altcoinbuzz.io/wp-content/uploads/2024/09/csdvsdfvtgrytuy-300x271.jpg 300w, https://www.altcoinbuzz.io/wp-content/uploads/2024/09/csdvsdfvtgrytuy.jpg 397w" sizes="(max-width: 520px) 100vw, 520px"></p> 
<h6 style="text-align: center;"><strong>Source: <a href="https://x.com/w_s_bitcoin/status/1706697383629701158?ref_src=twsrc%5Etfw" target="_blank" rel="noopener">X</a></strong></h6> 
<h5><b>3) US Mining Companies</b></h5> 
<p><span style="font-weight: 400;">Four US $BTC mining companies use Coinbase as their custodian. Hut8, CleanSpark Inc., Cipher Mining, and Bitfarms. Together they’re good for 17,609 $BTC.</span></p> 
<p><img decoding="async" class="wp-image-150268 aligncenter" src="https://www.altcoinbuzz.io/wp-content/uploads/2024/09/scdscddscsdc-300x202.jpg" alt="" width="607" height="409" srcset="https://www.altcoinbuzz.io/wp-content/uploads/2024/09/scdscddscsdc-300x202.jpg 300w, https://www.altcoinbuzz.io/wp-content/uploads/2024/09/scdscddscsdc.jpg 397w" sizes="(max-width: 607px) 100vw, 607px"></p> 
<h6 style="text-align: center;"><strong>Source: <a href="https://x.com/HODL15Capital/status/1832891755227746472?ref_src=twsrc%5Etfw" target="_blank" rel="noopener">X</a></strong></h6> 
<h5><b>Conclusion</b></h5> 
<p><span style="font-weight: 400;">It turns out that Coinbase is the $BTC custodian for quite a few big firms. This makes them a potential single point of failure in case of a hack. We have looked at some of the firms that use them as a custodian.</span></p> 
<p><a href="https://www.patreon.com/altcoinbuzz" target="_blank" rel="noopener"><img decoding="async" class="alignnone wp-image-123700 size-full" src="https://www.altcoinbuzz.io/wp-content/uploads/2023/09/Alpha_website_leaderboard-banner.jpg" sizes="(max-width: 1197px) 100vw, 1197px" srcset="https://www.altcoinbuzz.io/wp-content/uploads/2023/09/Alpha_website_leaderboard-banner.jpg 1197w, https://www.altcoinbuzz.io/wp-content/uploads/2023/09/Alpha_website_leaderboard-banner-300x37.jpg 300w, https://www.altcoinbuzz.io/wp-content/uploads/2023/09/Alpha_website_leaderboard-banner-1024x127.jpg 1024w, https://www.altcoinbuzz.io/wp-content/uploads/2023/09/Alpha_website_leaderboard-banner-768x95.jpg 768w, https://www.altcoinbuzz.io/wp-content/uploads/2023/09/Alpha_website_leaderboard-banner-696x86.jpg 696w, https://www.altcoinbuzz.io/wp-content/uploads/2023/09/Alpha_website_leaderboard-banner-1068x132.jpg 1068w" alt="" width="1197" height="148"></a></p> 
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<p>Disclaimer</p> 
<p>The information discussed by Altcoin Buzz is not financial advice. This is for educational, entertainment and informational purposes only. Any information or strategies are thoughts and opinions relevant to accepted levels of risk tolerance of the writer/reviewers, and their risk tolerance may be different from yours.</p> 
<p>We are not responsible for any losses that you may incur as a result of any investments directly or indirectly related to the information provided. Bitcoin and other cryptocurrencies are high-risk investments, so please do your due diligence.</p> 
<p>Copyright Altcoin Buzz Pte Ltd.</p> 
<p>The post <a href="https://www.altcoinbuzz.io/bitcoin-and-crypto-guide/3-reasons-the-crypto-industry-relies-on-coinbase/">3 Reasons the Crypto Industry Relies on Coinbase</a> appeared first on <a href="https://www.altcoinbuzz.io">Altcoin Buzz</a>.</p>

3 Reasons the Crypto Industry Relies on Coinbase

Altcoin Buzz

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