Coinbase continues to solidify its place in the cryptocurrency and blockchain industry with latest purchase.
Coinbase, the largest cryptocurrency exchange service in the United States, recently acquired Paradex. Paradex is a decentralized exchange platform that helps users trade their virtual coins directly with each other. Based in San Francisco, Coinbase is hoping to be able to make some improvements and advancements to the platform’s technology. The company also wants to push the services of Paradex to thousands of customers outside of the United States.
In a brief post published on Medium.com, Brian Armstrong, the co-founder and CEO of Coinbase, wrote the following:
“We’re thrilled to announce the acquisition of Paradex, a relay platform that will allow our customers to trade hundreds of tokens directly from their wallets. The move not only reinforces Coinbase’s commitment to investing in decentralized infrastructure and participating in the nascent world of wallet-to-wallet trading, but also our focus on the international crypto trader. After making some product enhancements, we’ll initially offer this experience to customers outside the U.S., and eventually to U.S.-customers. Welcome Paradex to the Coinbase team!”
Decentralized exchanges allow users to trade tokens and digital coins through smart contracts. While trading, the transactions are being recorded on a blockchain. While the idea of a decentralized exchange is still fairly new, universal adoption of blockchain is still a little ways down the road in the technological and financial future.
Paradex currently has 10 employees and is largely built on a foundation that is referred to as 0x. It is one of the few startup companies that are pitching the idea to customers that they can gain access to lesser-known or recognized cryptocurrencies. The Paradex platform will look to be integrated into Coinbase’s new product called Coinbase Pro in the next couple of weeks. It is only available to customers outside of the United States as of now.
Asiff Hirji, Coinbase’s president and chief operating officer, spoke to CNBC’s “Fast Money” about the new developments last Wednesday. He said, “This will significantly enhance the proposition for our customers in terms of what they want to trade and how they want to trade it….As soon as we can we’re going to turn it on in the U.S. We’re greatly increasing the number of things you can trade and we’re doing it in a compliant way.”
The deal with Paradex comes at a time when Coinbase has been on a pathway of making new acquisitions and looking to consolidate its place amid growing competition. The company recently hired Emilie Choi as vice president of corporate and business development. Before joining Coinbase, Choi guided more than 40 acquisitions as vice president of corporate development at LinkedIn. This includes acquiring the online education startup Lynda for $1.5 billion in 2015.
Additionally, the company purchased Earn.com, a social network that allows people to both earn and spend bitcoin. With the purchase, the startup’s CEO, Balaji Srinivasan, was hired as Coinbase’s first-ever chief technology officer. In April 2018, Srinivasan said, “Everyone is aligning behind Coinbase as the winner of blockchain in the U.S.”
While not disclosing terms of the deal, Coinbase described Paradex as “a sophisticated and secure relay platform that will allow our customers to trade hundreds of tokens directly from their wallets.” The company plans to retire GDAX on June 29 and move all customers to its new program, Coinbase Pro.