The FT's Alphaville argues that the stand out concern remains that the current framework under which Coinbase is regulated (a money transmission one) is not at all suited to regulating its broader activities and that It’s easy to be profitable if your real unique selling point is being a beneficiary of regulatory arbitrage.
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Why Coinbase’s stellar earnings are not what they seem
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But it’s worth reminding investors that the stand out concern remains that the current framework under which Coinbase is regulated (a money transmission one) is not at all suited to regulating its broader activities, among them its exchange activity and principal-trading operations. This is important because if Coinbase’s regulatory status were to change (and regulatory ambiguity is clocked in the company’s S1 risk factors) the company could be forced to drop many of these hugely profitable activities or be forced to operate at a much higher capital cost.
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