This isn't even remotely necessary for Coinbase to do well - the only thing they need is for crypto currencies to be more widely used in 25 years.

Absolutely, the only thing they need. Because the barriers to entry are so high!

Well regulation of this stuff is a kind of nightmare. Building an exchange is a nightmare - I tried once and scaling the thing is really complicated.

It's not like coinbase has not to worry about regulation anymore.

And for the technical aspect, did you spend a few billion dollars when you tried? Potential coinbase competitors may.

I don't think a valuation higher than NYSE and NASDAQ combined (or CME and CBOE combined) is reasonable.

They have a reasonable sized moat then no? I’ve no idea $77bn seems large, but they intend to be the world’s financial system in 10-20 years so could be worth even more.

> They have a reasonable sized moat then no?

Do they? I'd rather own a couple of major exchanges in today's financial system for the same price.

  ICE   net income $2.1bn  market cap $63bn
  NDAQ  net income $0.5bn  market cap $23bn
  CME   net income $2.1bn  market cap $72bn
  CBOE  net income $0.4bn  market cap $11bn

You've listed exchanges, but Coinbase is much more than just an exchange. They are also a broker, as well as bank (provision of loans), custody-provider, etc.

here are some brokers...

Charles Schwab (SCHW): $119.81bn

Interactive Brokers (IBKR): $32.47bn

I mean if they get their mission done they’ll be worth more...

Coinbase's real value seems like it'll be its ability to use deposits to provide loans. Big money in banking.

Is your money where your mouth is? 100% BTC will be worth more than it is today in 25 years.

100% huh

and you call yourself a quant lmao

better change it to expert in cryptocurrency on your linkedin profile

edit: nvm a crypto quant! this is even better! downvote away! sounds like someone is triggered

Why not just buy bitcoin then? Do you think coinbase will go 10x faster than btc?

Coinbase makes money in a down market because of trading volumes.

I guarantee you coinbase stock is going to be highly correlated to the price of Bitcoin.

I would disagree. Coinbase's value is based on volume and volatility. If anything, stable values are the worst time for exchanges, as experienced in early 2019.

Ehh, sort of. Volume is highly correlated with return due to the wealth affect. When crypto crashes people stop trading.

For a normal exchange yes, but for a Bitcoin exchange the long term revenue is going to depend on future interest in Bitcoin which is highly correlated to current price

10 trillion economy? maybe

I know people that said they will get Bitcoin once it falls back to $70. They said that around $150 and they are still waiting :)

never time the market

Bitcoin's a little different. It seems to peak every 4 years when the miner rewards are halfed.

What if the current bull market goes to $200k, and then the bear market retreats to $100k? This is why trying to time the market doesn't work.

keep in mind bear market could be hovering around 100-200k after this cycle tops. tough to time the market unless you have a ton of experience in the field.