What happened
Shares of cryptocurrency trading platform Coinbase Global (NASDAQ:COIN) popped on Monday, after the company announced it was bolstering its board of directors with a top-tier CEO from another company. As of noon ET today, Coinbase stock was up 6%.
So what
Tobias Lütke, CEO of Shopify (NYSE:SHOP), is joining Coinbase’s board of directors, per an official blog post from the crypto exchange this morning. According to Lütke, Shopify and Coinbase share a common vision to bring Web 3.0, the next iteration of the internet, to life.
Image source: Getty Images.
Lütke is a noted fan of the cryptocurrency space. For example, for his social media profile’s picture, Lütke sports a verified CryptoPunk — perhaps the most well-known and highest value non-fungible token project there is. Moreover, Lütke’s profile also displays an address that uses the Ethereum Name Service — think of it like a website on the blockchain. Suffice it to say, Lütke isn’t a novice when it comes to the cryptocurrency space.
Now what
Lütke’s involvement is exciting for Coinbase investors because it combines a powerful e-commerce player (Shopify) with a company that some investors believe could facilitate the future of finance (Coinbase). Most of Coinbase’s revenue today is generated from transaction fees for trading cryptocurrencies — a revenue stream that’s inconsistent and benefits from volatility. For this reason, it’s important for the company to develop better revenue streams in the long term. And involvement from Shopify’s Lütke stirs the imagination for future possibilities.
Specific plans weren’t discussed in today’s blog post from Coinbase. It just notes that Shopify and crypto could revolutionize “finance and payments, web applications, and the internet itself.” I think you’ll agree those are some big target markets.
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