The company claimed to have developed a very low-cost cross-border money-transfer service. The platform is testing a pilot in Mexico before deploying it probably a little later in other countries.
Remittance is a lucrative business, and one of the biggest players in it is Western Union. In 2020, the global remittance industry was estimated at $702 billion, and it’s anticipated to hit $1.23 trillion by 2030, according to Allied Market Research.
At the beginning of April, the firm said crypto investors in India could now use the country’s online retail payments system to transfer funds to the platform.
This system, known as United Payments Interface or UPI, is run by an entity, the National Payments Corporation of India that’s part of the country’s central bank.
But three days after the announcement, Coinbase had to suspend transfers of rupees, the local currency, to its trading app due to the fact that the authorities were not aware of company’s projects.
Coinbase customers found themselves without the means to fund their accounts with rupees.
NFT Marketplace
The company is experimenting with a new initiative still to increase its revenues and profits.
Coinbase has just launched its marketplace for the creation (mint) and sale of non-fungible tokens several months after unveiling this project.
This is a bet that these digital property titles are a long-term economic opportunity.
Coinbase’s NFT marketplace is available now in trial form (Beta).
“Beta testers will be able to create a Coinbase NFT profile to buy and sell NFTs using any self-custody wallet, whether that’s Coinbase wallet or something else,” Sanchan Saxena, vice-president of product, ecosystem products, said in a blog post .
“For a limited time, there’ll be no Coinbase transaction fees. We’ll eventually add fees, which will be in-line with web3 industry standards, and we’ll provide notice before anything changes.”
Web3 is the new iteration of the internet which is decentralized.
The beta testers are invited by Coinbase based on their position on a waitlist the company opened several months ago.
“We’ll start at the top of the waitlist and open access to more people over time. Stay tuned as we gradually make access to create profiles, buy, and sell on Coinbase NFT available to everyone,” Saxena said.
The problem is that the context between Coinbase’s announcements and the launch of this NFT marketplace has completely changed and not in a good way.
The euphoria around NFTs, the buzzword at the end of 2021 and the beginning of 2022, has died down. We are living a bit of a return to earth for these digital title deeds.
According to DappRadar statistics, OpenSea, the U.S. NFT marketplace leader, has seen a 6.74% decline over the last 30 days in active users, and a drop of 8.25% in internal transactions. Sales are down 67% over that period.
In addition, Coinbase is entering a now very competitive sector: its rivals Binance and FTX already have their NFT marketplaces.
“In a year in which profitability may be challenged, we question the strategic rationale of chasing NFTs, especially as interest in NFTs appears to be dwindling,” Dan Dolev, analyst at Mizuho, wrote to its clients early April.
Market cap is now at $38.5 billion from $65.47 billion when it was listed on the stock market a year ago. Coinbase’s market cap has thus shrunk by nearly $27 billion.
