Coinbase App Downloads Back to Mooning, Partners with Mitsubishi to Onboard its 40 Million Japanese Customers

As Coinbase starts with retail products for MUFG account holders who will be able to buy and sell BTC, ETH, LTC, BCH, and XLM. It also stockpiled $4.36 billion in cash, four times higher than at the end of 2020, for rainy days including a stricter regulatory regime.

The largest cryptocurrency exchange in the US, Coinbase, has started to climb the ranks yet again.

Coinbase App’s ranking in the US bottomed in late July when it fell to 445 spots. Since then, it has climbed to about 200 rankings, but still, it has a long way to go as during the March to May mania, it went on to capture the top spot on both App Store and Google Play in the finance category for free apps.

The same is the case for other crypto-related apps in the finance category, with Blockolio back up at 28 from 411 on June 29 on Google Play. eToro Crypto has jumped more than 175 spots on Apple Store and 118 on Google Play in less than a month, much like Kraken Pro, which jumped 151 and 216 spots respectively.

Binance, however, is seeing slow growth in the US, currently above 65 on the App Store and 50 on Google Play, up from near 100 last month but still down from the top 10 in May.

Amidst this, Coinbase Global announced that it is partnering with MUFJ Financial Group Inc. to start a cryptocurrency exchange in Japan. This partnership will allow the account holders of the nation's biggest bank to buy and sell crypto assets, said the exchange in a statement.

Coinbase has already got approval easier this year in Japan, where it will face local competition from 31 companies registered to trade crypto, including Monex Group-owned Coincheck and GMO Coin.

“We aim to reach out to a wide range of customers by offering low-hurdle services,” Nao Kitazawa, head of Coinbase Japan, said on Thursday.

The US-based crypto exchange already offers crypto trading to 68 million users and 9,000 institutions, and now with this latest partnership with MUFG, it will cater to another 40 million Japanese customers.

“Our partnership with MUFG will help millions of people in Japan access our platform quickly and begin trading on our exchange by offering MUFG Quick Deposit for all customers in Japan from day one.”

Coinbase will start with launching retail products that will include a suite of top five assets based on trading volume viz. Bitcoin, Ethereum, Litecoin, Bitcoin Cash, and Stellar.

While initially targeting retail, Kitazawa is optimistic about the prospect for institutional business as he said an increasing number of institutional investors want to talk with them, and “their questions have been getting more specific recently,” he added.

Stockpiling Cash for Rainy Days

Amidst all this, Coinbase has stockpiled $4.36 billion in cash as of June 30, which is four times higher than at the end of 2020, to weather a host of business risks in the crypto industry said Chief Financial Officer Alesia Haas. Additional cash is maintained as insurance against unidentified risks, she said.

Hass shared that the company is preparing for a stricter regulatory regime, potential trading declines, or possible cyberattacks.

“We want to ensure that we maintain those cash reserves so that we can continue to invest and continue to grow our products and services in the event that we go into a crypto winter.”

Coinbase is also paying close attention to SEC Chair Gary Gensler’s public statements as they “believe that regulation can be an enabler and not a burden.” Also, the exchange may have to face new tax-reporting requirements under the $1 trillion infrastructure bill, but the exchange already has systems in place to comply with the measure, and it expects the compliance costs to be immaterial.

Meanwhile, during the second quarter, it reported a revenue of $1.61 billion, compared to $32 million a year earlier as its retail monthly transacting users increased roughly six-fold over the same period, to 8.8 million, who account for more than 94% of transaction revenue. Also, the addition of new crypto, such as Dogecoin, in June further boosted revenue, Haas said.

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