Coinbase CEO Brian Armstrong Reveals What It Takes for Altcoins To Be Listed on Exchange

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The head of the biggest cryp­to exchange in the US is reveal­ing the company’s strat­e­gy for list­ing new dig­i­tal assets on its platform.

In an inter­view with Lex Frid­man, Coin­base CEO Bri­an Arm­strong says that the first step of list­ing an alt­coin on the exchange is deter­min­ing whether or not the asset qual­i­fies as an unreg­is­tered security.

“We basi­cal­ly have a test of legal­i­ty. We check: ‘Do we believe this is a secu­ri­ty?’ If so, it can’t be list­ed on Coin­base. And there’s a very rig­or­ous process we go through for that. 

Just cur­rent­ly the way the laws are in the US, you can’t do that. We acquired a bro­ker-deal­er license from the SEC. We’re try­ing to work with them to get that oper­a­tional and hope­ful­ly one day, we can trade real cryp­to secu­ri­ties but today, that’s not pos­si­ble in the US.”

Arm­strong says that after legal­i­ty comes secu­ri­ty. If it all checks out, the cryp­to bil­lion­aire says that Coin­base more or less wants to go ahead and list the asset as part of its mis­sion to list as many assets as pos­si­ble, mov­ing away from the notion that it endors­es any of its altcoins.

Arm­strong pre­dicts that even­tu­al­ly there will be “mil­lions” of cryp­tocur­ren­cies and that Coin­base may aim to posi­tion itself as the “Ama­zon” of cryp­to, offer­ing vast selec­tions of prod­ucts as long as they aren’t fraud­u­lent or dangerous.

“Then we look at the cyber­se­cu­ri­ty of the cryp­to asset. Do we think there’s some flaw in the smart con­tract, or a way that some­body could manip­u­late it with­out the cus­tomers’ permission? 

We look at some com­pli­ance pieces to it as well, like the actors behind it and any kind of crim­i­nal his­to­ry and things like that. If we believe it meets our list­ing stan­dards, basi­cal­ly this test of legal­i­ty and every­thing for cus­tomer pro­tec­tion, then we want to list it because we want the mar­ket at that point to decide. 

It’s kind of like Ama­zon or some­thing like that where a prod­uct might have three stars or it might have five stars, but if it starts to get one star con­sis­tent­ly, it’s prob­a­bly fraud­u­lent or defec­tive or some­thing and maybe Ama­zon will remove it. Oth­er­wise, you want to let the mar­ket decide what these things are…

My belief is there’s gonna be mil­lions of these assets over time, and so I hope it doesn’t make news every time we add one in the future, basically.”


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Disclaimer: Opinions expressed at The Daily Hodl are not investment advice. Investors should do their due diligence before making any high-risk investments in Bitcoin, cryptocurrency or digital assets. Please be advised that your transfers and trades are at your own risk, and any loses you may incur are your responsibility. The Daily Hodl does not recommend the buying or selling of any cryptocurrencies or digital assets, nor is The Daily Hodl an investment advisor. Please note that The Daily Hodl participates in affiliate marketing.

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