Earlier this year, MicroStrategy selected Coinbase as the primary execution partner for its $425 million Bitcoin purchase.
With their expert capabilities in executing projects, Coinbase has succeeded in buying a substantial amount of Bitcoin on MicroStrategy’s behalf. Coinbase leveraged its OTC desk and renowned crypto prime brokerage platform to carry out this feat without moving the market.
MicroStrategy’s Strategic Partnership With Coinbase
The reason for MicroStrategy’s partnership with Coinbase is centered on the latter’s prominence in market tools. These market tools include possessing an advanced algorithm and smart order routing, not to mention white-glove sales and trading services put Coinbase in the spotlight as a worthy partner to be selected by MicroStrategy.
Coinbase also employs a system whereby single large orders can be taken and broken into many smaller parts. These smaller parts are then executed across various trading venues. This smart order routing mechanism helps in disguising the overall trade size and would also minimize the impact on the trade market.
By utilizing the already existing Coinbase technology, the trading team was able to achieve an average execution price that was below the price with which the purchasing process began. When high volatility periods surfaced, Coinbase made use of their advanced trading tools to improve the execution for MicroStrategy, which was as high as 1%. With this strategy, MicroStrategy was able to acquire about $4.25 million in savings.
Coinbase Hopes To Assist More Companies
Recently, many companies have been looking for ways to diversify their excessive cash, and crypto has been an available option. For this reason, Coinbase is readily available to serve these companies. Coinbase also aims to establish an open financial system where companies such as MicroStrategy recognize the value of cryptocurrencies. With this, such companies can contribute to the growth of the cryptoeconomy.
When more companies delve into crypto, this may become an inflection point for the cryptoeconomy. In relation to this, Coinbase aims to assist more institutions and corporate companies that are planning to diversify their capital allocation strategies through crypto.
Companies like MicroStrategy that have worked with Coinbase can testify to the latter’s discretion and customs services. These services are crucial as critical investment decisions need to be made. As an agency, Coinbase reassures clients that the interests of both parties are aligned in working towards finding the best prices that are available in the market.
At the time of publication, Bitcoin is trading for $19,014.29, marking a 1.2% increase in price over the last 24 hours. BTC has a market cap of $353,100,405,419 and a 24-hour trading volume of $23,886,573,338.
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