Confessions from Coinbase's CEO: "At One Point We Considered Buying Bitcoin Heavily Like MicroStrategy, But..."
The largest cryptocurrency exchange in the U.S., Coinbase, announced that it evaluated the aggressive Bitcoin acquisition strategy adopted by MicroStrategy's founder Michael Saylor in the past but ultimately abandoned this plan due to risks.
Coinbase CEO and co-founder Brian Armstrong stated in a video talk on the social media platform X, "Several times in the last 12 years, we wondered whether we should invest 80% of our balance sheet assets in Bitcoin." However, according to Armstrong, this strategy could seriously jeopardize the company's cash position and potentially lead Coinbase to bankruptcy. Armstrong said, "We made a conscious choice regarding risk."
Although Coinbase has abandoned this strategy, the company added $153 million worth of cryptocurrency, primarily Bitcoin, to its investment portfolio in the last quarter. According to Coinbase's latest shareholder letter, the company holds a total of $1.3 billion worth of cryptocurrency.
Speaking in the same post on the X platform, Coinbase's Chief Financial Officer Alesia Haas stated that they do not want to compete with their customers. Haas, who said, "We will not stop at this point," mentioned that the company will continue to increase its crypto assets.
On the other hand, many companies have started to adopt similar strategies by taking Saylor's model of financing Bitcoin investments through stock and debt sales as an example. MicroStrategy's shares have gained more than 3000% in value since it began purchasing Bitcoin in 2020. The company holds approximately $54 billion worth of Bitcoin.