Cryptocurrency exchange, Coinbase, has said that they are “on track” to become a licensed and regulated cryptocurrency securities exchange, which will make it easier for investors to buy into ICOs by acquiring security tokens.
Initial Coin Offerings, or ICOs, can offer a significant return on investment, although the investor should tread with extreme caution because a large number of ICOs do fail. In fact, if you had invested in the top performing ICO of 2018, Ontology, you would have returned 44 times your initial investment. Even by the incredible standards of the cryptocurrency market, these are significant gains.
Improved Access To ICOs
However, buying these tokens is not as simple as visiting an exchange and buying what you want. After conducting research, you will need to buy the tokens directly from the ICO website and store them in a compatible wallet.
One of the aims of Coinbase is to simplify this process, and potentially act as an exchange for these tokens. They have started on this path through the acquisition of Keystone Capital Corp., Venovate Marketplace Inc., and Digital Wealth LLC. They have now applied to the federal authorities to become a regulated broker-dealer.
This would not only allow Coinbase to operate as a securities broker, but would enable them to offer margin trading and over the counter trading.
Coinbase currently allows for the trading of fiat currencies with Bitcoin, Ethereum, Litecoin, Bitcoin Cash. It is one of the biggest exchanges in the world, with more than 20 million users, and is one of the few exchanges that allows for the buying of cryptocurrencies using fiat. With Binance making moves to offer a similar fiat-for-crypto service, Coinbase is also looking to expand its services and corner a greater portion of the crypto market.
A Positive Move?
There are supporters and critics of the move, with some welcoming the move towards greater regulation, because it will protect users and help prevent scams like Bitconnect, but there are also those that want as little oversight from governments and government agencies as possible.
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