Coinbase, the US-based crypto exchange that is looking to diversify its product base on a war footing, is also looking to build out the blockchain infrastructure for the developers in a big way, similar to what AWS did a couple of decades back.
AWS was started in a small manner when cloud infrastructure was not considered very optimal for development but it has since grown to become a major money-spinner for Amazon. Coinbase seeks to s=eulate this model for the blockchain industry. With over 30 blockchain networks currently operational and more to follow in the future, it is indeed going to be a big challenge for the platform to build out a safe and reliable infrastructure on which the developers could flock in and build their dApps and build such a thing is not just about having a multitude of servers. It would also need to have a variety of developer services that needs to be inbuilt into the platform and all this is going to present a unique challenge for the company but so far, they seem to be up for the challenge.
“We want to be the AWS of crypto,” said Coinbase chief product officer Surojit Chatterjee. “We are building this whole Coinbase Cloud suite of products that you can think of as crypto computing services, to help developers build their applications faster.”
Among the multiple reasons for the platform to diversify, the major one seems to be the fact that its revenue depends a lot on the transactions volumes at the crypto exchange which is in turn dependent on the price volatility of bitcoin and other cryptos. This is a drawback that most of the exchanges around the world seem to be suffering from with monthly and quarterly revenues showing a major uptick when the market is volatile while the revenues plunge when the market ranges. As a publicly listed company, this does not make good business sense for either the platform or its investors for its share value and revenues to be tied to the price of bitcoin. To mitigate this, Coinbase is looking to diversify its product range and invest in other features and businesses so that it can stabilise its revenue over time which would make it more attractive to the investors and also more resilient as a company for the future.