Coinbase, a preferred exchange by those who are novice followers or traders of cryptocurrency has announced that, in the upcoming months, it will be supporting ERC20 Tokens, found on the Ethereum Blockchain.
ERC, short for Ethereum Request for Comments, is a technical standard that has been created with the intentions of bettering the Ethereum Platform. Currently, the ERC20 standard consists of 6 functions and 2 events, which allow individuals to sign smart contracts that help to create tokens, handle transactions, maintain balances of token holders and better understand how tokens can be transferred. Ethereum has proposed two others, namely, ERC223 and ERC721, which help to solve concerns that cannot be solved via the ERC20.
According to Coinbase, “this paves the way for supporting ERC20 assets,… though we aren’t announcing support for any specific assets or features at this time.” While uncertainty still holds, Coinbase’s intentions of supporting ERC20 is beneficial to many new traders, as it allows one to trade more than just the current, Bitcoin (BTC), Ethereum (ETH), Litecoin (LTC) and Bitcoin Cash (BCH). In particular, Coinbase is taking leaps to ensure that traders have access to a better, easy-to-understand and applicable platform; opening doors for growth.
Another factor that influences the type of assets that will be listed on Coinbase is the Coinbase Custody. Coinbase Custody is investors-friendly, as it claims to abide by strict financial controls, phone support, a well-balanced digital currency custodian, increased storage security and additional support for currencies. If the ERC20 Tokens abide by Coinbase Custody, traders can expect the assets to appear on GDAX, and hopefully on Coinbase.
The validity of such claims, as previously mentioned, is said to be solid after the assets have been listed on GDAX. Normally, this procedure will take time, as several metrics like liquidity, the Network Value to Transactions Ratio (NVT), reserve ratio, maturity, technology and others must be considered.
The new announcement is great, as it allows one to develop his or her existing portfolio with different types of alternative coins (alt coins), but for the time being, the wait is still on!