Many fondly remember their first Bitcoin transaction. It likely took place on Coinbase, one of the first exchanges to serve the Western marketplace. Bitcoin became tradeable on Coinbase when the price of a coin was in the single digits and daily volume couldn’t match the population of a small country town. Since then, this exchange has helped Bitcoin gain traction and made it more accessible to consumers the world over. There’s no doubt that Bitcoin fans today have a soft spot for the exchange, and those who began trading early probably have Coinbase to thank for their riches.
The company wields its influence over the market quietly, but this power in the cryptocurrency world is undeniable. As a certain wise uncle once said, with great power comes great responsibility, and Coinbase currently sits in a precarious position. Some questionable behavior in the past is raising eyebrows inside the community and out, yet few seem to grasp just how thin a line the exchange walks.
Exchanging the Game
Bitcoin was originally a closed ecosystem, with those who mined it the only ones to receive the cryptocurrency as a reward. This is the unique “proof of work” algorithm that keeps the ecosystem running to this day, reimbursing miners with Bitcoin for verifying and processing transactions on the network. However, exchanges allowed trading between Bitcoin that had already been mined, and fiat money like Dollars, Pounds and Yen. In some ways, this was good: It put Bitcoin into the hands of those who didn’t want to, or couldn’t, mine it, but it also opened a whole new can of worms.
