Coinbase has become the first cryptocurrency platform to be considered a full-service prime broker, offering a comprehensive suite of services including trading, custody, financing, derivatives, and cross-margining. According to John D'Agostino, head of strategy at Coinbase Institutional, this is a significant milestone, as it allows the company to provide a one-stop-shop for institutional investors. In traditional finance, only a handful of firms, such as Goldman Sachs and Morgan Stanley, offer this level of service. In the crypto space, Coinbase is the only company that provides all of these services natively, rather than through partnerships or patching together different providers.
The company's Coinbase Prime platform holds over $350 billion in assets under custody and serves as custodian for more than 80% of U.S. bitcoin and ether ETF assets. With the recent addition of cross-margining, Coinbase has completed its suite of services, allowing market makers and institutional traders to reduce capital requirements.
The company's institutional platform processes roughly $236 billion in quarterly trading volume and supports over 470 assets across 20-plus blockchains. D'Agostino expects that, as the crypto market grows, banks and other financial institutions will partner with Coinbase rather than trying to build their own capabilities. For now, the company's main competition comes from startups, rather than established financial institutions.