Coinbase’s new venture capital fund has announced a strategic investment in Compound, a startup that is building money market accounts for cryptocurrency investors.
Compound is the first project to receive venture funding from Coinbase as part of the company’s new efforts for fostering blockchain innovation. As CCN reported, Coinbase announced the new venture fund to incubate early-stage startups in the exploding industry.
Coinbase’s funding is part of a larger $8.2 million seed funding round, which pools other backers including Bain Capital Ventures, Andreessen Horowitz and Polychain Capital, with participation from Transmedia Capital, Compound Ventures, Abstract Ventures, Danhua Capital.
While other coin and token projects have debated ways to generate interest or dividend income, Compound has run with the idea. In a blog update, Salil Deshpande, Managing Director at Bain Capital Ventures, he states that current lending solutions for cryptoassets “are not good enough: they are either centralized and have substantial counterpart risk, or require robust order books for each type of cryptoasset, which generally do not exist.”
Compound’s mission is to put cryptoassets to work that now “sit idle on exchanges and in wallets, yielding no interest,” according Founder Robert Leshner in a blog update about the funding announcement.
“…when Compound launches it’s [sic] first money markets on the Ethereum blockchain, individuals, institutions and applications will earn interest on Ether, stablecoins and utility tokens, with complete liquidity — similar to the overnight rate for dollars and government currencies.”
The core technology behind Compound is a decentralized blockchain infrastructure that is centered around a series of open-source smart contracts. As part of the smart contracts, the interest rates for each asset adjust dynamically in response to the borrowing demand for that asset. An algorithm makes these adjustments in real time, according to the project’s whitepaper.
Compound hopes to attract borrowers such as hedge funds, sophisticated speculators, and other Ethereum applications.
As Compound’s technology aligns closely with Coinbase’s entrenched status as a company that is revolutionizing traditional finance, it is no small wonder why it has received the firm’s backing. The company’s target market of institutional investors is in line with Coinbase’s recent rolling out of a suite of tools for only these clients, as CCN reported on May 15.
Compound’s core technology also eases reporting, since each money market is transparent, auditable, and completely predictable. Coinbase itself has also worked hard on institutional-grade reporting as part of efforts for becoming an SEC-regulated brokerage.
Coinbase Crypto Exchange Launches the Single Sign On (SSO) via Consensus
Coinbase exchange sets the standards in cryptocurrency exchange industry as well as having prestige that most exchanges honestly lack.
This comes from the company’s will to have the best infrastructure and marketing ideas to outcompete other exchanges. Well, that is what the company showed once again on Thursday with the Single Sign On (SSO) via Consensus mechanism.
In a blog post on Coinbase blog by Kareem Moussa, the Infrastructure team at Coinbase developed the Single Sign On to make it easy and safe for engineers to elevate their own permissions temporarily to perform complex infrastructure changes. Changes on the Coinbase platform are consensual over a quorum of engineers that must follow set mechanisms that implement the consensus.
These engineers are requires to vote and approve the permission, code and configuration changes a user may be willing to implement. The consensus mechanisms allow for clear guidelines and auditable trails of any changes made to the Coinbase system. Furthermore, the security of the user’s funds is enhanced due to the consensus and audit trails.
Hypergrowth at Coinbase has presented many opportunities to tackle new scaling challenges, including onboarding engineers in a quick and secure manner. Read more about the Single Sign On system we built to automate user privilege escalation via consensus. https://t.co/VEaOfotj2k
— Coinbase (@coinbase) December 13, 2018
The company has seen a huge growth in the number of employees in 2018, from 200 to over 600 employees. The company has resulted to automation of the manual provision of accounts as they plan to expand further in future. The past few months have been excellent for Coinbase, from offering egg freezing benefits to their employees, announcing that they will be adding hundreds of cryptocurrencies on the site and now the SSO.
The Single Sign On is an identity provider that is expected to protect the changes made to the code, permissions or configurations through a consensus to change current system of manually provisioning accounts. The automated system will work on having the highest security standards.
To ensure that these standards of the identity provider are met, the system employs a combination of SAML, LDAP, and consensus.
The consensus is enabled through the Security Assertion Markup Language (SAML) that doubles up as the defector enterprise SSO protocol. Coinbase philosophy is to partner with GitHub and Amazon Web Services (AWS) to provide production services for its protocol. SAML is used to send cryptographically signed permissions, to these production services which are in turn used to authorize users on Coinbase platform.
Using the SAML identity providers which automates the service provisions requires the LDAP directory service. The service is used to represent organizations structure that secures the native authentication mechanisms for users.
The consensus uses the SAML identity provider to automated services for the engineers changing from the manual provisions. This will enable the Coinbase to build one of the most secure and efficient platform to switch up the cryptocurrency industry.
C-Suite Departure: Coinbase’s Chief Product Officer Has Left the Startup
A C-suite executive has left Coinbase, the cryptocurrency exchange turned tech unicorn.
CoinDesk confirmed Tuesday that Jeremy Henrickson is no longer with the company, having departed on November 2. Henrickson started with Coinbase in July 2016 and served as VP of product and engineering before becoming chief product officer in 2017, according to his LinkedIn.
“Jeremy’s contributions to Coinbase over the past two years were invaluable,” a Coinbase spokeswoman told CoinDesk. “He helped to build our scrappy startup team into a high-functioning product and engineering organization—overseeing a 5x+ growth of the team.”
“In guiding that part of the company’s journey, Jeremy scaled up our ability to execute, set the vision for our product and engineering teams, and was an inspirational leader within the organization. Jeremy joins a prestigious group of Coinbase alumni who are all working to build a more open financial system.”
The Stanford grad began his career at Apple in the 1990s. Henrickson spoke at an event at the Palo Alto school as recently as last month.
A source characterized Henrickson’s exit as one that lets him get some hard-earned rest after scaling the team through a tumultuous period in the wider crypto industry. According to the source, Henrickson culturally represented “the softer side of Coinbase.”
Henrickson’s exit comes amid a period of growth at the startup, which in recent months has seen it open a new office in New York City as part of a bid to expand its employee base. At the same time, Coinbase has had some higher-level exits, including long-time executive Adam White (who left to join Bakkt) and Hunter Merghart, its now-former head of trading.
Personnel changes aside, Coinbase is pushing ahead with its stated plan to continue listing new cryptocurrencies and digital assets on its exchange. To this end, the startup released a list last week of 30 assets and later four of those tokens were listed on its professional trading platform.
Coinbase Reveals the Assets It Is Considering Listing, Including XRP, NEO, Stellar, and EOS
According to a recent blog post, one of the largest cryptocurrencies exchanges in the US, Coinbase noted it is considering the addition of several new assets on its platform. The list includes several ERC20 and standalone assets including Ripple’s XRP, one of the most highly anticipated coins to arrive on the platform.
Offering Support for More Assets
In its blog post, Coinbase said:
“We are continuing to explore the addition of new assets and will be working with local banks and regulators to add them in as many jurisdictions as possible.”
It added that the goal of the exchange is to support new assets that meet listing standards and comply with local laws. It suggests that the exchange intends to list 90% of all assets by market cap.
Which Assets Is Coinbase Considering?
All new listings on the exchange have to comply with the Digital Assets Framework created by Coinbase that assess a project based on its security, compliance and other crucial factors. The assets that could debut on the exchange include Cardano’s ADA, Ripple’s XRP, Stellar Lumens (XLM), Tezos (XTZ), ChainLink (LINK), Decentraland (MANA), NEO (NEO), Kyber Network (KNC), EOS (EOS) and Dai (DAI).
Other tokens being considered for a possible listing are Aeternity (AE), Status (SNT), Zilliqa (ZIL), Aragon (ANT), Mainframe (MFT), Maker (MKR), IOST (IOST), EnjinCoin (ENJ), Golem Network (GNT) Request Network (REQ), QuarkChain (QKC), Bread Wallet (BRD), Augur (REP), Stor (STORJ), Civic (CVC), Loopring (LRC), OmiseGo (OMG), Kin (KIN), Loom Network (LOOM), districtox (DNT) and Po.et (POE).
Coinbase suggested that it cannot guarantee that all the assets mentioned above will be listed on the platform as each listing has to satisfy both technical and compliance issues. It also noted that due to the listing process, some of the assets could only be available for buying and selling, without the ability to send and receive with a local wallet. New assets will be added on a jurisdiction-basis, meaning that if an asset doesn’t match the local compliances, it would not be available for trading in that jurisdiction.