Recently Coinbase disclosed that it intended to begin accepting ERC20 tokens. These are Ethereum (ETH) token standard and they possess common rules that all ethereum tokens must follow. This standard thus allows anyone to create their own virtual currency. So far over 70% of all token sales have been made using the ERC20 standard on the blockchain of Ethereum.
“This paves the way for supporting ERC20 assets across Coinbase products in the future, though we aren’t announcing support for any specific assets or features at this time,” read a post by Coinbase.
Several Coinbase products are likely to be affected by the development and this includes Coinbase Custody – a service which provides secure storages for digital assets especially large holdings. Though there are no figures indicating the number of customers who use Coinbase Custody it is one of the most prominent custodian services for digital assets in the United States. By adding ERC20 tokens it will be possible for more diverse virtual currency trusts to be introduced.
Coinbase’s trading platform, GDAX, is also likely to be affected by the move. At the moment GDAX only offers support for Bitcoin Cash (BCH), Litecoin (LTC), Ethereum and Bitcoin (BTC). But Coinbase has indicated that it will wait for regulatory clarity before it adds other assets.
Coinbase Asset management
Coinbase’s index fund, Coinbase Asset management, is also expected to include new assets based on their market capitalization. The payment processing product of Coinbase, Coinbase Commerce, is however not expected to allow payments in other virtual currencies.
The decision by Coinbase to begin accepting ERC20 tokens coincides with reports indicating that Coinbase is now featured on the intro of a new season of Silicon Valley, a HBO comedy set in the world’s foremost tech city. The addition of Coinbase to the intro of Silicon Valley is a testament to how cryptocurrencies have captured the world’s imagination. In its past seasons the Silicon Valley show has featured the various tech companies that are considered trendy in its intro. This has included Slack, Snap and Theranos. Lyft and Uber have joined Coinbase this year.
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