Coinbase is reportedly in an active process to expand its product offerings in Australia to include stock trading and payments, directly competing with traditional companies.
Coinbase is planning to expand its offerings in Australia to include derivatives, equities and payments after securing an Australian financial services license (AFSL).
John O'Loghlen, regional managing director for APAC at Coinbase, said the Australian financial services license (AFSL) will see the exchange initially offer crypto and equity perpetuals but will open the door for futures, options and other traditional financial products.
“We’re going to compete with traditional financial services on stock trading, payments and other TradFi products with the speed and execution of crypto,” O'Loghlen said. — Cointelegraph report
The blockchain advantage
The convergence of digital assets and traditional assets is taking shape with a growing number of TradFi companies offering exposure to these emerging markets and now, we're seeing more of crypto-native companies moving into TradFi markets.
Contrary to what many may think is happening, the convergence isn't merely a process of merging traditional and digital assets into unified trading or investing interfaces, rather, it's a process where all of TradFi comes on-chain.
The advantage is putting it on-chain. Coinbase understands this. JPMorgan understands this and they've demonstrated just how through recent on-chain operations including the launch of its owned blockchain-based assets for settlements.
Blockchain rails are an execution advantage layer. The constraints of traditional rails are non-existent with it.
Finance is faster, cheaper and programmable on-chain.
This opens the markets up for more flexibility is not just how participants or users can function, but also to what extent products and services can be built.
Payments
When it comes to coinbase, I've long spoken on what I believe is its ultimate end of the day plan, and that is payments.
This is also too easy a conclusion to come to, especially when looking at what its venture arm funds and what it builds internally.
We have the Base network for instance, branded specifically around "payments."
The ongoing battle over stablecoin yields also suggests this. Its ties with Circle, which issues USDC, is also a piece of evidence. It really isn't a hidden intention.
Trading assets is cool, stocks and crypto trading has its perks, there's evidently revenue to be made, but payments, that's just a different game that's not comparable and effectively the major target market.
For stock and crypto trading to occur, payments have to come first. When working with blockchain rails, we are looking at much higher monetary velocity and more moving volumes means more money for the company whose infrastructure holds up the system.
The long-term monetization model may very well shift from trading fees to payment and infrastructure fees.
The goal seems to be to build the "financial super app" — instead of users jumping through multiple apps for payments, trading, savings, FX, investing and credit, they'd only need one.
Coinbase evidently aims to leverage the blockchain execution advantage to make this happen.