According to John D'Agostino, head of strategy at Coinbase Institutional, the company has achieved a significant milestone by becoming the only full-service prime brokerage in the crypto space. This is characterized by its ability to provide trading, custody, financing, derivatives, and cross-margining services at scale, including an additional layer of staking. In traditional markets such as equities and fixed income, only a few firms, including Goldman Sachs, Morgan Stanley, and Bank of America, qualify as full-service prime brokers. D'Agostino noted that smaller brokers can support funds but do not offer the full range of services.
In the crypto industry, until recently, funds had to piece together services from different providers. However, Coinbase is now the only platform that offers all these services natively.
As the largest US-based cryptocurrency exchange and a major provider of infrastructure for institutional investors, Coinbase offers trading, custody, and financing services through its Coinbase Institutional unit. Its flagship platform, Coinbase Prime, bundles these functions into a single system, allowing hedge funds and asset managers to trade, store, and finance digital assets under one roof. With over $350 billion in assets under custody, Prime holds around 12% of the total crypto market cap and serves as custodian for more than 80% of US bitcoin and ether ETF assets.
The firm has become a key bridge between traditional finance and crypto markets, operating under a growing regulatory framework. The rollout of cross-margining between spot and derivatives positions in March marked the final piece of the puzzle, allowing market makers and institutional traders to reduce capital requirements. D'Agostino emphasized that this development has cemented Coinbase's position as a prime broker by any standard. The company's institutional platform processes roughly $236 billion in quarterly trading volume and supports over 470 assets across more than 20 blockchains.
Beyond trading and custody, Coinbase has a $1 billion lending book and the industry's largest listed derivatives footprint through its Deribit integration. Its staking business spans 10 to 20 tokens at institutional scale. According to D'Agostino, while other firms may excel in specific areas such as custody, derivatives, or lending, none of them offer the full range of services in one place.
The relative size of the crypto market, currently at around 3% to 5% of global equities and fixed income markets, has limited the involvement of major banks. However, D'Agostino expects that banks and incumbents will partner with existing players rather than building their own solutions. In the long term, if the crypto market grows to 20% or 30% of global markets, full-scale competition can be expected. For now, the main threat to Coinbase comes from startups rather than established financial institutions.