Is the encryption industry really needed to value the $8 billion Coinbase Visa debit card?

Recently, Xu Mingxing forwarded Coindesk's Twitter on Twitter, saying:

“What is the commission for the Coinbase visa card? Does the encryption industry really need a visa card?”

Not long ago, Bitcoin Coinbase launched a special Visa debit card for the UK and some European countries. This debit card can provide cryptocurrency consumption services.

In addition to the ability to convert cryptocurrencies into legal currency during the consumption process, as with your own bank account funds, Coinbase's debit card can be consumed at any time without pre-existing currency.

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As Xu Ming said, does the encryption industry really need this visa card?

US market suspended service into Europe

However, for Coinbase, this is not the first cryptocurrency debit card. On November 21, 2015, Coinbase officially released the first bitcoin debit card that can be used in the United States. The first batch of open-use covers the United States. In some states, users can make bitcoin payment consumption in physical stores and online stores.

In addition, there are many limitations to this bitcoin debit card. For example, the user's daily spending limit cannot exceed $1,000; the withdrawal amount from ATM can't exceed $200/$500 per day (after debit card is associated with Dwolla account, the daily withdrawal limit can be increased to $500), and the withdrawal must be paid 2.5~ $3 fee; international transactions charge 3%.

According to Coinbase at the time, this bitcoin debit card was used as a "beta" and could not exceed 1000 users.

According to Adam White, vice president of business development and strategy at Coinbase, the bitcoin debit card was introduced to make bitcoin more acceptable.

In our view, there is nothing more convincing in the way that Bitcoin is more acceptable than its rising price.

In February 2019, foreign media reported that the Bitcoin debit card ceased operations on April 11, and the service industry using cryptocurrencies will be terminated.

After four years of use in the US, the visa card had to be tentatively serviced. Just a few days after stopping service in the US, Coinbase launched a crypto-currency visa card that is open to the UK and some European countries. It is inevitable that it is a step-by-step move.

After all, for the cryptocurrency of the current market, the value of investment and the value of circulation are light and heavy.

Valuation of $8 billion from "most conservative" to "junk token"

Coinbase, a Bitcoin company, created the first bitcoin exchange in the United States with a formal license and passed the official certification of the NYDFS (New York Financial Services Authority) in 2017, which is after the June 2016 Ripple, NYDFS The third Bitcoin license issued.

On April 16, 2017, Coinbase announced the acquisition of Earn.com (formerly 21 Inc) for $100 million. According to Recode, some of the purchases were paid to the founders and investors of Earn in the form of Coinbase shares. Since the company's stock is not publicly traded, the $8 billion valuation is based on Coinbase's estimate of its value. Earn's management agreed to reach an acquisition at this price.

Compared with the well-known domestic exchanges, the value of the currency in December 2017 was only 1.4 billion US dollars. However, compared with the actual operation of Coinbase, the transaction volume of Coinbase is 10 times that of Coinbase. Therefore, whether the valuation of 8 billion US dollars is unfounded, it directly reflects the current status of the digital currency industry:

The application of blockchain technology is still a minority. The digital currency trading platform has captured the investment profit psychology of the core users of the market and is the most stable income component of the current digital currency market.

In the beginning, Coinbase was known as one of the most conservative exchanges in the field of encrypted digital currency, as it only offered users no more than 10 digital cryptocurrencies.

On December 7, 2018, Coinbase announced that it will expand its token business in the digital currency field on a large scale, and there are many "pollution tokens" that are not performing well. This period of time is a phase in which the digital currency is relatively deserted.

From the issuance of visa cards to better promote the market recognition of digital currencies to dozens of digital assets on the line, we do not discuss the feasibility of visa card issuance. This is called the most conservative exchange is a little overdraft. Their own user reputation, after all, in the eyes of users, the valuation of 8 billion is always better than the investment of their own assets, and the services they provide are no longer a digital asset of conservative and measurable investment.

Whether to encrypt a digital currency requires a visa card

Undoubtedly, cryptocurrencies have the characteristics of decentralization, unlike traditional payment systems. Eliminating the cumbersome process of the transaction, it is easier to achieve transactional interoperability between different platforms.

But for crypto-money visa cards, it provides a more convenient way for crypto-equity payments, but what is the value of the cryptocurrency they expect for users with cryptocurrencies?

As Xu Mingxing said, what users in the encrypted digital currency market really need to achieve transaction demand or to satisfy investment profits?

(Source: Running Finance)

Editor: Originally titled "Coinbase with a valuation of $8 billion and Xu Star with a value of 10 billion"

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