Can the early success of major crypto exchanges propel them to winning the broader consumer finance market?submitted by mickhagen to genesisblockhq [link] [comments]
This is the first part of Crypto Banking Wars — a new series that examines what crypto-native company is most likely to become the bank of the future. Who is best positioned to reach mainstream adoption in consumer finance?
While crypto allows the world to get rid of banks, a bank will still very much be necessary for this powerful technology to reach the masses. We believe a crypto-native company, like Genesis Block, will become the bank of the future.
In an earlier series, Crypto-Powered, we laid out arguments for why crypto-native companies have a huge edge in the market. When you consider both the broad spectrum of financial use-cases and the enormous value unlocked through these DeFi protocols, you can see just how big of an unfair advantage blockchain tech becomes for companies who truly understand and leverage it. Traditional banks and fintech unicorns simply won’t be able to keep up.
The power players of consumer finance in the 21st century will be crypto-native companies who build with blockchain technology at their core.The crypto landscape is still nascent. We’re still very much in the fragmented, unbundled phase of the industry lifecycle. Beyond what Genesis Block is doing, there are signs of other companies slowly starting to bundle financial services into what could be an all-in-one bank replacement.
So the key question that this series hopes to answer:
Which crypto-native company will successfully become the bank of the future?We obviously think Genesis Block is well-positioned to win. But we certainly aren’t the only game in town. In this series, we’ll be doing an analysis of who is most capable of thwarting our efforts. We’ll look at categories like crypto exchanges, crypto wallets, centralized lending & borrowing services, and crypto debit card companies. Each category will have its own dedicated post.
Today we’re analyzing big crypto exchanges. The two companies we’ll focus on today are Coinbase (biggest American exchange) and Binance (biggest global exchange). They are the top two exchanges in terms of Bitcoin trading volume. They are in pole position to winning this market — they have a huge existing userbase and strong financial resources.
Will Coinbase or Binance become the bank of the future? Can their early success propel them to winning the broader consumer finance market? Is their growth too far ahead for anyone else to catch up? Let’s dive in.
BinanceThe most formidable exchange on the global stage is Binance (Crunchbase). All signs suggest they have significantly more users and a stronger balance sheet than Coinbase. No other exchange is executing as aggressively and relentlessly as Binance is. The cadence at which they are shipping and launching new products is nothing short of impressive. As Tushar Jain from Multicoin argues, Binance is Blitzscaling.
Here are some of the products that they’ve launched in the last 18 months. Only a few are announced but still pre-launch.
Can they create a cohesive & united product experience?
Binance WeaknessesBinance is strong, but they do have a few major weaknesses that could slow them down.
Binance Wrap UpI don’t believe Binance is likely to succeed with a homegrown product aimed at the consumer finance market. Their current product — which is focused heavily on professional traders and speculators — is unlikely to become the bank of the future. If they wanted to enter the broader consumer market, I believe it’s much more likely that they will acquire a company that is getting early traction. They are not afraid to make acquisitions (Trust, JEX, WazirX, DappReview, BxB, CoinMarketCap, Swipe).
However, never count CZ out. He is a hustler. Binance is executing so aggressively and relentlessly that they will always be on the shortlist of major contenders.
CoinbaseThe crypto-native company that I believe is more likely to become the bank of the future is Coinbase (crunchbase). Their dominance in America could serve as a springboard to winning the West (Binance has a stronger foothold in Asia). Coinbase has more than 30M users. Their exchange business is a money-printing machine. They have a solid reputation as it relates to compliance and working with regulators. Their CEO is a longtime member of the crypto community. They are rumored to be going public soon.
Coinbase StrengthsLet’s look at what makes them strong and a likely contender for winning the broader consumer finance market.
Coinbase WeaknessesLet’s now look at some things that could hold them back.
Coinbase Wrap UpAt Genesis Block, we‘re proud to be working with Coinbase. They are a fantastic company. However, I don’t believe that they’ll succeed in building their own product for the broader consumer finance market. While they have incredible design, there are no signs that they are focused on or capable of internally building this type of product.
Similar to Binance, I think it’s far more likely that Coinbase acquires a promising young startup with strong growth.
Honorable MentionsOther US-based exchanges worth mentioning are Kraken, Gemini, and Bittrex. So far we’ve seen very few signs that any of them will aggressively attack broader consumer finance. Most are going in the way of Binance — listing more assets and adding more pro tools like margin and futures trading. And many, like Coinbase, are trying to attract more institutional customers. For example, Gemini with their custody product.
Wrap UpCoinbase and Binance have huge war chests and massive reach. For that alone, they should always be considered threats to Genesis Block. However, their products are very, very different than the product we’re building. And their approach is very different as well. They are trying to educate and onboard people into crypto. At Genesis Block, we believe the masses shouldn’t need to know or care about it. We did an entire series about this, Spreading Crypto.
Most everyone needs banking — whether it be to borrow, spend, invest, earn interest, etc. Not everyone needs a crypto exchange. For non-crypto consumers (the mass market), the differences between a bank and a crypto exchange are immense. Companies like Binance and Coinbase make a lot of money on their crypto exchange business. It would be really difficult, gutsy, and risky for any of them to completely change their narrative, messaging, and product to focus on the broader consumer market. I don’t believe they would ever risk biting the hand that feeds them.
In summary, as it relates to a digital bank aimed at the mass market, I believe both Coinbase and Binance are much more likely to acquire a startup in this space than they are to build it themselves. And I think they would want to keep the brand/product distinct and separate from their core crypto exchange business.
So back to the original question, is Coinbase and Binance a threat to Genesis Block? Not really. Not today. But they could be, and for that, we want to stay close to them.
Other Ways to Consume Today's Episode:
Download the app. We're a digital bank that's powered by crypto: https://genesisblock.com/download
BIP 101 is Gavin Andresen’s proposal for increasing the block size limit, and it is currently operational in an alternative implementation of Bitcoin, known as Bitcoin XT. Unlike BIP 100, the block size limit grows at a predictable rate with this proposal. The block size limit is initially raised to 8MB on January 11, 2016 in BIP 101. It would then double every two years for 20 years. It ... Bitcoin Blockchain Fork. Over the weekend two bitcoin core developers released Bitcoin XT, a way to 'opt out' of bitcoin's current 1MB block size limit. This is the first attempt to resolve the ... The Bitcoin block size debate, a technical dispute over an intrinsic aspect of the network, has been taken entirely too far for at least one core developer. Mike Hearn has lost faith in the system ... Crypto Volumes Surge in August: Binance Largest Spot Exchange as Huobi Leads Derivatives ... Next month’s bitcoin cash 32MB block size increase will allow enough room for transactions for years to come. Tokenization and Smart Contracts Are Coming Colored coins and representative tokens are coming to the BCH chain. In addition to the large block size increase, the BCH chain will incorporate ... It is a fork (a copy in a way) of Bitcoin (BTC). It was created in August 2017 as a result of a disagreement on bitcoin scalability problems. Influential miners, developers and investors not content with the Segregated Witness feature of Bitcoin (BTC) decided to increase bitcoin transaction capacity eight times by making the block size bigger. $ Bitcoin Unlimited is an attempt to upgrade Bitcoin Core into a client that processes bitcoin transactions into blocks with a potential maximum size greater than the Core's hard-coded limit of one megabyte. The one megabyte block size limit was added in 2010 by Satoshi Nakamoto as a temporary anti-DoS measure. This limited the maximum network capacity to about three transactions per second.  BTCChina Pool, for example, is running both Bitcoin Core and Bitcoin XT clients, leading to block # 370838 being 8MB in size, whereas block # 370845 is a regular 1MB block. Speaking of Bitcoin ...
[index]          
Buy NAV Binance: ... Navcoin was built on Bitcoin core but there were a number of changes that the developers have built into the coin. These include things like sub-chain architecture. One of the ... This video is unavailable. Watch Queue Queue Bitcoin rewards last fell on 9 July 2016 at the point of the second halving – an event which saw the block reward fall from 25 new bitcoin per block to 12.5 bitcoin. Bitcoin’s price surged ... Using directed acyclic graph (DAG) technology instead of the traditional blockchain, IOTA's transactions are free regardless of the size of the transaction, confirmation times are fast, the number ... This push came to a head in July 2017 some members of the Bitcoin community including Roger Ver felt that adopting BIP 91 without increasing the block-size limit favored people who wanted to treat ... Blockchain service provider TAAL has processed the largest block to date on Bitcoin SV — 369MB in size and containing 1.3 million transactions. TAAL announced the milestone on Twitter . The ... I tell You How To Register And How To Verified binance account verification,It Is very Easy You Can Finish in 5 Mint For Register binance Click on this link : https://goo.gl/DrCxfM For Register ... The block size however has been a topic of heated debate in the crypto community for quite some time. The Bitcoin Cash (or as Roger Ver loves to call it, “B-Cash”) fork was a direct result of ... The next bitcoin halving is expected to occur in the week commencing 18 May 2020, when the number of blocks hits 630,000. It will see the block reward fall from 12.5 to 6.25 bitcoins. The exact ... When Bitcoin was first created, Satoshi Nakamoto did not intentionally limit the block size, with the largest block reaching up to 32MB. At that time, an average block size is around 1 to 2 KB.