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Coinbase Raises $25 Million From Andreessen Horowitz

193 points by espeed 13y ago

coinbase-craig 13y ago
We are hiring for lots of positions. If you are interested and enthusiastic about bitcoin (or just curious), please take a look: https://coinbase.com/careers https://coinbase.com/careers
- preech99 13y ago
  When are you going to add altcoins support? Also, why can't I import privkeys like I can with blockchain.info? Finally, your API documentation is out of date and the examples don't accurately reflect the data that Coinbase sends in response.
  - ejhong 13y ago
    You can import privkeys. It's kind of hard to find though - you have to go to account -> integrations and look for the paper wallet import.
  - 3pt14159 13y ago
    I don't think they should offer alt-coins, it sends a fragmented message in a time that most consumers are already overwhelmed.
- Bitwse 13y ago
  Do you expect litecoin to be coming anytime soon? That is the question on everyones mind and I dont see any mention of it. Would love if you could comment on this :)
- Einstalbert 13y ago
  I don't have any applicable skills for the team, but the company perks remind me of a fun start-up that wants its workers to work their asses off (free lunch and -dinner-? Better throw in the Dr. Pep). I like that. Hope you guys do well.
- jagermo 13y ago
  How do you feel about translating? I have some capacities free and help you conquer Germany, Austria and Switzerland...
- robinhoode 13y ago
  All your positions are in SF :( Would you be interested in a remote (east coast) Rails engineer w/ 8 years experience?
  - barmstrong 13y ago
    Yes, we have some remote engineers also. We should probably reflect this better on the careers page. Sorry about that.
- krashidov 13y ago
  Have you guys thought about an internship program?
weekendcoder 13y ago
With an increasing number of Bitcoin based startups raising substantial capital, there might be an incentive to keep the price of Bitcoins high. Launching soon: http://www.codeforbitcoins.com/ http://www.codeforbitcoins.com/
- wesley 13y ago
  I believe there is an alt-coin named "devcoin" that has similar intentions as you do (but they obviously pay in their own alt-coin)
  - weekendcoder 13y ago
    Thanks, good to know!
gexla 13y ago
Well, there's another vote of confidence in Bitcoin. It seems to be a battle of good and bad press. Ultimately, I don't think it matters. The votes are in and the people have said they want virtual currency. If it's not Bitcoin, next man up.
- rch 13y ago
  Not sure what to make of the alt-coin thing. Is there an algorithm that favors FPGAs?
  - Hermel 13y ago
    Digital currencies are a classical winner-takes-it-all market. There is not much room for alternatives besides Bitcoin. Also, Bitcoin has a huge lead - an altcoin would have to be fundamentally better than Bitcoin in order to take over. Similarily, TCP and SMTP have both never been replaced by newer protocols. I suspect the same to be the case for Bitcoin. Also, revising the core of Bitcoin in any significant way will be prove at least as hard as replacing IPv4 with IPv6.
    - Dwolb 13y ago
      Interesting. If it's true Bitcoin will be replaced by another algorithm, then Bitcoin does not make much sense to hold. It would then be true that Bitcoin is a tool to facilitate real currency transactions.
    - kristiandupont 13y ago
      What makes it a winner-takes-it-all market? I've been considering buying a Litecoin or two just for the fun of it. I have greater faith in Bitcoin for sure, but unless a technical flaw destroys it, I don't see exactly why Litecoin should disappear.
      - sfjailbird 13y ago
        For one I would think the market cap has to be enormous, to avoid any large entity being able to move the market. Even now with bitcoin at, what, 15 billion dollars? Price can still be swayed 5-10% by a million dollar purchase. Which is what leads people to criticise it for price swings. Not enough money in the world to support too many networks of the necessary size.
parham 13y ago
Just found out about coin base. I couldn't find a way to deposit BitCoin directly to my account, is there a reason for this?
- cdash 13y ago
  It doesn't seem to be advertised well on the main page but you can go to account settings and then bitcoin addresses to see addresses associated with your account you can send your btc to.
  - mrb 13y ago
    Yes that's the way to do it. No need to "request money" as explained by someone else.
- christiangenco 13y ago
  Click "request money", then leave all the fields blank and click the blue "request money" button in the popup modal again. It'll give you a deposit address. Completely intuitive - I know.
  - parham 13y ago
    That is a serious flaw. I was thinking they had evil intentions.
coderdude 13y ago
Coinbase is cruising at escape velocity. I signed up for an account around the time they launched. I had some questions about button creation so I emailed them. In response, Brian (the founder) coded up a button API to make it possible to generate payment buttons on the fly. Needless to say, the show of dedication was impressive. Congratulations to the Coinbase team.
- leokun 13y ago
  What does "Coinbase is cruising at escape velocity." mean?
  - coderdude 13y ago
    They're growing very quickly.
    - revelation 13y ago
      So they will burn endless amounts of fuel (venture capital), rise high but deliver exponentially little, and promptly fall back to burn up in the atmosphere?
      - cma 13y ago
        That would be cruising under escape velocity
    - pbreit 13y ago
      The anecdote provided would imply the opposite.
- davidjgraph 13y ago
  I would avoid any company "cruising _at_ escape velocity". Approaching it, fine, but at that specific velocity it's downhill from here. For definitions here let's have Wikipedia[0] and Oxford dictionary[1] 0. "escape velocity is the speed at which the kinetic energy plus the gravitational potential energy of an object is zero. It is the speed needed to "break free" from the gravitational attraction of a massive body, without further propulsion." 1. "a speed for a particular vehicle, ship, or aircraft, usually somewhat below maximum, that is comfortable and economical" An object travelling at escape velocity without further propulsion will just (only just) escape the gravitational pull of the contextual body. That means by the time it's distant enough from the body for the gravitational forces to be trivially weak, it's going damn slowly. This means the company is slowing down continually, relative to that body. In terms of whether you can "cruise" at escape velocity, I don't think so. Going at escape velocity for as much of the journey as possible would require a huge propulsion at the start, with a very high initial speed and use of fuel. I suggest cruising would actually be when you spend most of the journey below escape velocity by applying propulsion more steadily. The maximum velocity experienced in the company would be lower (comfort) and less fuel would be used. The other downside of always being at escape velocity, unless the destination lies at a distance from the body where there's still a relatively non-trivial gravitational pull left, there's a good chance you'll die before you get there. [0] http://en.wikipedia.org/wiki/Escape_velocity http://en.wikipedia.org/wiki/Escape_velocity [1] http://www.oxforddictionaries.com/definition/english/cruising-speed http://www.oxforddictionaries.com/definition/english/cruisin...
tga 13y ago
This would be a good time to spend some of that money on building up the customer support. I gave them a try and for my first purchase I received BTC at a significantly higher rate than they quoted and confirmed. To make things worse, I still have no reply on the support ticket 10 days later. Not exactly what I'd expect from a company handling significant amounts of money in a market that's struggling to gain recognition and trust.
- coinbase-craig 13y ago
  On rare occasions we are not able to provide bitcoin at a locked-in price. When we can't, we offer the ability to place an order in USD for an amount of BTC equal to the exchange rate at the time that we receive your USD from the bank, 4 business days later. When this is offered as an option, we display a note on the buy page that says: "Note! We've exceeded our normal buy limits for today. If you would still like to purchase you will receive the market price of bitcoin on [some date] after your funds have arrived." You are also required to agree to a term like this before placing an order: "I acknowledge that the amount of BTC I receive will vary based on future exchange rates." Some users check the box without reading it; maybe this happened to you. We're trying very hard to scale our support team. We've gone from 1 to 12 support in a matter of months, and we are hiring more support staff, and it is still difficult to keep up. We are responding, but it is almost impossible to grow fast enough. That said, 10 days sounds way too long. If you send your coinbase email address to me at craig(at)coinbase, I'll get your ticket prioritized.
  - tga 13y ago
    Thanks Craig, posting about my personal issue here feels a bit like cheating, but it was nice of you to jump in. I can imagine support is already a priority, but consider this my nudge about it.
    - ejhong 13y ago
      And also note that it is 3:30 am in San Francisco. Go to bed coinbase-craig!
  - 13y ago
salient 13y ago
This is why the start-up environment sucks in Europe. It seems so (relatively) easy to get $20 million in US as a start-up, while it seems almost impossible to get that kind of money in Europe from an investor, which is why there are so many "winner takes all" companies from US and not from other places. This happens at a time when Bitstamp is several times bigger than Coinbase, also growing fast, and is covering both EU and US. Yet, because of this sort of funding (and probably more later), there will probably be yet again a US company dominating the scene. In a post-Snowden relevations time, I'm not very eager to continue using US services, but the environment seems to be so harsh for non-US companies that want to be global companies, and they basically have to grow themselves into global companies only through bootstrapping (the vast majority of them, I'm sure there are a few exceptions).
- skrebbel 13y ago
  Do most US investors care whether or not the companies they find are in the valley, or even on the same continent? (note: no value judgment here, I really don't know and I wonder)
  - ig1 13y ago
    It depends on the VC and the size of the round, some VCs only invest in a very specific area while others are more flexible for larger investments. Most of the major VCs do invest internationally in larger rounds. For example in the last year Greylock invested in Wrapp (SWE), Sequoia invested in 6Wunderkinder (DEU) and Skyscanner (GBR), BVP in NewVoiceMedia (GBR), USV in Hailo (GBR) and FundingCircle (GBR), IA & Valar in TransferWise (EST/GBR), etc.
  - nasalgoat 13y ago
    Yes, there is a massive bias against tech companies not in the Valley. My company, based in Canada, recently finished a $50M Series C road trip that included the Valley and New York, and the contrast between the two could not be any larger. The Valley VCs and investors were dismissive and incredulous that a Canadian company could achieve the success we had, and that we could find people "good enough" to make systems able to handle the kind of traffic we were running. They genuinely couldn't believe we'd done it outside of California. New York, however, was much more interested and receptive, and ended up being the best source for our future funding. This whole business is less about numbers and reality and more about feelings and who you know than anyone wants to admit.
wellboy 13y ago
This will be the third YC billion dollar company and 1 Bitcoin will be worth $50,000. Wait 1 year.
TimJRobinson 13y ago
I still wonder why I as a buyer would choose to buy through coinbase rather than PayPal or just credit card. For sellers it is awesome and I know how bad PayPal is for sellers so I understand that. But as a buyer if I don't care about being anonymous why would I spend a currency that is deflating and has no safeguards or way to charge back when I could just use fiat, have safety and feel better knowing the money I just spent won't be worth 10% more tomorrow.
- phoboslab 13y ago
  Porn. Though I'm wondering why Bitcoin adoption in the porn industry still seems to be so slow. Usually they're the first to jump on new technology.
  - laichzeit0 13y ago
    I want to laugh but you're absolutely right. Military and pornography applications are the driving forces behind any successful technology.
  - leokun 13y ago
    Eh, if you're trying to be anonymous your ISP is still tracking what you are watching. If you run a proxy on a server somewhere that provider is tracking it. If you're using anonymizing software your connection will be slow, but that might work. Also the websites that provide the type of content you're referring to like to gauge people with expensive subscription costs and I'm not sure how you can set up a subscription service with bitcoin.
    - phoboslab 13y ago
      But it doesn't show up on your banking statements where your spouse could see it. The "felt anonymity" is much higher, imho.
      - acjohnson55 13y ago
        Yeah....instead it just shows you've bought BTC, and if your spouse is at all sophisticated, they probably assume you're using it for something shady.
tocomment 13y ago
Would it be possible for CoinBase to have some kind of FDIC like insurance? It seems like that's the biggest problems with bitcoins these days is that there's no safe place to store them.
- natrius 13y ago
  The purpose of deposit insurance is to prevent runs on banks that make loans and don't have as much money in their vaults as the total of their customers' balances. Coinbase does not make loans. As far as I can tell, it's a service that stores your actual bitcoins for you. FDIC-style insurance isn't applicable.
  - tocomment 13y ago
    Very good point. But I still think the bitcoin ecosystem is missing a foolproof way to securely store bitcoins in the way that US dollars have a bank. Paper wallets can get lost or stolen, A lot of online wallets get hacked, and DIY encryption doesn't seem like a great way to go either, especially for grandma. I'd happily pay a fee to coinbase in exchange for some kind of insurance against them being hacked.
    - natrius 13y ago
      Agreed. The bitcoin ecosystem will need traditional banks, credit cards, and the rest of the financial services industry. Prices that involve transfers will just be lower, and interest rates on deposits will have to factor in expected deflation once that stabilizes.
- deleted 13y ago
  [deleted]
bachback 13y ago
The major news here is that Bitcoin is corrupting itself by affiliating with major corporate interest. Silicon Valley thinks they own Bitcoin - they will be proven wrong. a fork is becoming more and more likely. Gavin is not treating his responsibilities well and should find himself a well paid job if he wants to make money. there is something wrong with incentives here. Bitcoin is global, not a US owned network.
- vidarh 13y ago
  Bitcoin is not one entity. When someone effectively "creates money" then of course there's a strong incentive for people to build businesses around it. Things can fork as much as it wants: Any alt-coin that becomes successful will attract people trying build businesses around it. If you want to prevent people from making money on it, find a means for people to achieve their goals without exchanging anything that can be converted into money. Good luck trying to do that without also making it pointless and/or unusable.
  - bachback 13y ago
    I think you misunderstood what I was saying. I was referring to the fact that the core Bitcoin dev, basically the guy in charge of the network, joined the board of one company in Silicon Valley. If I have a competing business, what do you think his preferences are going to be? So if this continues there will be a fork, so that devs of the protocol are prevented from selling out. I think the core bitcoin devs are really going in a very wrong direction with their affiliations.
    - ashray 13y ago
      You are right. Bitcoins and bitcoin businesses in general have taken a very American twist. The entire 'bitcoin foundation' had turned into nothing more than a lobby group which is what Gavin happens to belong to. Large bitcoin businesses are dominate by Americans so far: Coinbase and Bitpay. Happy that Bitstamp isn't US owned but not sure for how long. It's basically a repeat of what happened with the Internet. No one is stopping other regions from taking their own slice of the pie. It just appears that Americans are quicker on the innovation front and seem to understand where future value may lie and thus take appropriate risks.
loceng 13y ago
I'm wondering how much of this money is invested in Bitcoin itself - how much Bitcoin Coinbase is holding onto or own. It is a smart way for investors to start gathering Bitcoin.
- ashray 13y ago
  I honestly doubt that much of this is going into buying and holding bitcoins. Institutional investors are already trading big numbers of bitcoins via Second Market. They don't use regular exchanges and certainly wouldn't need to go through the 'false investment' route. I do however think a large part of this would go towards Coinbase improving its bitcoin stash. They've been running out of stock every single week.
- pbreit 13y ago
  Probably zero if Coinbase is operating above board (which I assume it is).
deleted 13y ago
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jroseattle 13y ago
I question how far the Bitcoin industry can develop without government regulatory agencies getting involved. Granted I don't have a deep background in financial systems, but this seems like more than a remote possibility. I see a parallel with Bitcoin and the financial system to Uber & Lyft with traditional taxi/limo services. In Seattle, both Uber & Lyft are being hassled by the city since they don't fall under the regulations that apply to taxis and limousines. And truth be told, I think that Uber & Lyft are going to see the regulatory matters eventually impact their operation, rather than going away. And that's just working at a local level. Payment systems on a worldwide scale? Seems commensurately high-risk, high-reward at present, where the "high" measurement is significant.
- wmf 13y ago
  Bitcoin is already regulated by FinCEN, although AFAIK none of the startups are compliant with the regulations.
  - cdash 13y ago
    Sure, it is regulated by FinCEN but what does that do for me? It seems FinCEN is nothing more than a part of the national security theatre than actually regulations that help me.
  - jackgavigan 13y ago
    > Bitcoin is already regulated by FinCEN... Technically it's not. FinCEN regulates money services businesses and they have decided that people/companies who exchange virtual currencies for USD are in the money services business. It might sound like nitpicking but it's an important distinction.
7Figures2Commas 13y ago
Bitcoin needs more effective mainstream marketing and with $25 million in depreciating dollars, I really hope that Coinbase is the entity that brings Bitcoin to the masses. I would strongly suggest that Coinbase do an endorsement deal with William Devane and start buying ad spots on FOX News. The script is simple. William rides up on a horse and tells viewers: I just feel so much more secure knowing that I own Bitcoin. And you can't print Bitcoin. Don't you just love the feel of Bitcoin? I buy my Bitcoin from Coinbase, because I trust them. No gimmicks. Coinbase will beat any price of any Bitcoin and at any time. Just call em. And Coinbase transfers my Bitcoin in 10 days or less, faster than anyone else. So protect yourself from the problems of the world. Invest in volatility with Coinbase. With such a compelling commercial[1], there's no reason we couldn't see BTC $1 million. [1] http://www.youtube.com/watch?v=QCJCcnhbmr0 http://www.youtube.com/watch?v=QCJCcnhbmr0
applecore 13y ago
That's about 29,000 bitcoins at today's price.
crassus 13y ago
Does coinbase have any intention to switch to a smaller bitcoin denomination at any bitcoin price?
deleted 13y ago
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pdknsk 13y ago
I wonder if the "12 Days of Bitcoin" on Bloomberg played a tiny part in this. I was watching a segment the other day which had one of the reporters talk about purchasing BTC and mention that Coinbase is very reputable. http://www.bloomberg.com/video/12-days-of-bitcoin-what-do-you-need-to-buy-one-orjc75uLSpmMSbJDGB6Fkw.html http://www.bloomberg.com/video/12-days-of-bitcoin-what-do-yo...
- hoka 13y ago
  Doubtful, I think. Raising venture rounds of any size (especially this one) takes a very long time! Bloomberg may have caught wind of the deal, however, and chose to release the story to capitalize on the press trend.
joering2 13y ago
I gave up multiple times on purchasing Litecoins. All I want to do is securely use my american credit or debit card to purchase 200 litecoins at reasonable price and fee. In the world run by bitcoin, is that too much to ask?
- aianus 13y ago
  I think the simplest way to buy litecoins as an American is to buy bitcoins using coinbase and then exchange them for litecoins on btc-e.
- scintill76 13y ago
  It would probably be easiest to buy bitcoins with Coinbase and trade them for litecoins at an exchange. You are going to have a hard time buying any cryptocurrency with a card, because it is too easy for you to reverse the charge and take the irreversible cryptocurrency. The places that let you buy bitcoins with cards are a lot more expensive for this reason.
kolev 13y ago
I both love and hate Coinbase! So far, they've cost me hundreds of dollars. Some may consider it stolen money. I understand the technical issue, but I'm sure when they get adopted by a wider and not-so-technical audience, they may become a target of a nasty class action lawsuit. For example, I bought several times Bitcoin with them, you see the price, then you get a popup to confirm (sometimes the popup shows a different price than what you originally got, but that's fine as it's confirmation page), you hit the button and guess what - after looking in your transaction history, you see you got charged sometimes tens, sometimes - hundreds of dollars more. Basically, the price moved, and they charged you a different amount. No warning, no nothing. Again, I understand why this is happening, but they make enough (1%) to honor the price. As I suspect, sometimes they sell from their own inventory of Bitcoins, so, they don't depend on the market order.
- jackgavigan 13y ago
  > ..I bought several times Bitcoin with them, you see the price, then you get a popup to confirm (sometimes the popup shows a different price than what you originally got, but that's fine as it's confirmation page), you hit the button and guess what - after looking in your transaction history, you see you got charged sometimes tens, sometimes - hundreds of dollars more. Basically, the price moved, and they charged you a different amount. No warning, no nothing. That's shocking (if true). Recording trades at a price that's different from what the user saw on their screen when they clicked to commit to the trade is pretty fundamental fuck-up. It's a "Drop EVERYTHING! We need to fix this NOW!" kind of problem. There's a good chance that someone's head would roll if it happened in an investment banking/capital markets-type environment. I know for certain that if it was happening with a bank's online payments service (the sort of thing where you can send EUR from your USD bank account), the service would simply be switched off until the problem was fixed. You'd have to get the legal department involved to notify the regulator and assess the company's liability. You'd have to go through the logs to find every single instance of it ever happening and write to each and every customer who was disadvantaged to inform them, apologise and reimburse them. And there'd be a significant fall-out, with very senior people asking "How the fuck could this happen?!" I get the impression that some Bitcoin startups have a lot of growing up to do.

193 points by espeed 13y ago

We are hiring for lots of positions. If you are interested and enthusiastic about bitcoin (or just curious), please take a look: https://coinbase.com/careers https://coinbase.com/careers

preech99 13y ago
When are you going to add altcoins support? Also, why can't I import privkeys like I can with blockchain.info? Finally, your API documentation is out of date and the examples don't accurately reflect the data that Coinbase sends in response.
- ejhong 13y ago
  You can import privkeys. It's kind of hard to find though - you have to go to account -> integrations and look for the paper wallet import.
- 3pt14159 13y ago
  I don't think they should offer alt-coins, it sends a fragmented message in a time that most consumers are already overwhelmed.
Bitwse 13y ago
Do you expect litecoin to be coming anytime soon? That is the question on everyones mind and I dont see any mention of it. Would love if you could comment on this :)
Einstalbert 13y ago
I don't have any applicable skills for the team, but the company perks remind me of a fun start-up that wants its workers to work their asses off (free lunch and -dinner-? Better throw in the Dr. Pep). I like that. Hope you guys do well.
jagermo 13y ago
How do you feel about translating? I have some capacities free and help you conquer Germany, Austria and Switzerland...
robinhoode 13y ago
All your positions are in SF :( Would you be interested in a remote (east coast) Rails engineer w/ 8 years experience?
- barmstrong 13y ago
  Yes, we have some remote engineers also. We should probably reflect this better on the careers page. Sorry about that.
krashidov 13y ago
Have you guys thought about an internship program?

weekendcoder 13y ago

With an increasing number of Bitcoin based startups raising substantial capital, there might be an incentive to keep the price of Bitcoins high. Launching soon: http://www.codeforbitcoins.com/ http://www.codeforbitcoins.com/

wesley 13y ago
I believe there is an alt-coin named "devcoin" that has similar intentions as you do (but they obviously pay in their own alt-coin)
- weekendcoder 13y ago
  Thanks, good to know!

gexla 13y ago

Well, there's another vote of confidence in Bitcoin. It seems to be a battle of good and bad press. Ultimately, I don't think it matters. The votes are in and the people have said they want virtual currency. If it's not Bitcoin, next man up.

rch 13y ago
Not sure what to make of the alt-coin thing. Is there an algorithm that favors FPGAs?
- Hermel 13y ago
  Digital currencies are a classical winner-takes-it-all market. There is not much room for alternatives besides Bitcoin. Also, Bitcoin has a huge lead - an altcoin would have to be fundamentally better than Bitcoin in order to take over. Similarily, TCP and SMTP have both never been replaced by newer protocols. I suspect the same to be the case for Bitcoin. Also, revising the core of Bitcoin in any significant way will be prove at least as hard as replacing IPv4 with IPv6.
  - Dwolb 13y ago
    Interesting. If it's true Bitcoin will be replaced by another algorithm, then Bitcoin does not make much sense to hold. It would then be true that Bitcoin is a tool to facilitate real currency transactions.
  - kristiandupont 13y ago
    What makes it a winner-takes-it-all market? I've been considering buying a Litecoin or two just for the fun of it. I have greater faith in Bitcoin for sure, but unless a technical flaw destroys it, I don't see exactly why Litecoin should disappear.
    - sfjailbird 13y ago
      For one I would think the market cap has to be enormous, to avoid any large entity being able to move the market. Even now with bitcoin at, what, 15 billion dollars? Price can still be swayed 5-10% by a million dollar purchase. Which is what leads people to criticise it for price swings. Not enough money in the world to support too many networks of the necessary size.

parham 13y ago

Just found out about coin base. I couldn't find a way to deposit BitCoin directly to my account, is there a reason for this?

cdash 13y ago
It doesn't seem to be advertised well on the main page but you can go to account settings and then bitcoin addresses to see addresses associated with your account you can send your btc to.
- mrb 13y ago
  Yes that's the way to do it. No need to "request money" as explained by someone else.
christiangenco 13y ago
Click "request money", then leave all the fields blank and click the blue "request money" button in the popup modal again. It'll give you a deposit address. Completely intuitive - I know.
- parham 13y ago
  That is a serious flaw. I was thinking they had evil intentions.

coderdude 13y ago

Coinbase is cruising at escape velocity. I signed up for an account around the time they launched. I had some questions about button creation so I emailed them. In response, Brian (the founder) coded up a button API to make it possible to generate payment buttons on the fly. Needless to say, the show of dedication was impressive. Congratulations to the Coinbase team.

leokun 13y ago
What does "Coinbase is cruising at escape velocity." mean?
- coderdude 13y ago
  They're growing very quickly.
  - revelation 13y ago
    So they will burn endless amounts of fuel (venture capital), rise high but deliver exponentially little, and promptly fall back to burn up in the atmosphere?
    - cma 13y ago
      That would be cruising under escape velocity
  - pbreit 13y ago
    The anecdote provided would imply the opposite.
davidjgraph 13y ago
I would avoid any company "cruising _at_ escape velocity". Approaching it, fine, but at that specific velocity it's downhill from here. For definitions here let's have Wikipedia[0] and Oxford dictionary[1] 0. "escape velocity is the speed at which the kinetic energy plus the gravitational potential energy of an object is zero. It is the speed needed to "break free" from the gravitational attraction of a massive body, without further propulsion." 1. "a speed for a particular vehicle, ship, or aircraft, usually somewhat below maximum, that is comfortable and economical" An object travelling at escape velocity without further propulsion will just (only just) escape the gravitational pull of the contextual body. That means by the time it's distant enough from the body for the gravitational forces to be trivially weak, it's going damn slowly. This means the company is slowing down continually, relative to that body. In terms of whether you can "cruise" at escape velocity, I don't think so. Going at escape velocity for as much of the journey as possible would require a huge propulsion at the start, with a very high initial speed and use of fuel. I suggest cruising would actually be when you spend most of the journey below escape velocity by applying propulsion more steadily. The maximum velocity experienced in the company would be lower (comfort) and less fuel would be used. The other downside of always being at escape velocity, unless the destination lies at a distance from the body where there's still a relatively non-trivial gravitational pull left, there's a good chance you'll die before you get there. [0] http://en.wikipedia.org/wiki/Escape_velocity http://en.wikipedia.org/wiki/Escape_velocity [1] http://www.oxforddictionaries.com/definition/english/cruising-speed http://www.oxforddictionaries.com/definition/english/cruisin...

tga 13y ago

This would be a good time to spend some of that money on building up the customer support. I gave them a try and for my first purchase I received BTC at a significantly higher rate than they quoted and confirmed. To make things worse, I still have no reply on the support ticket 10 days later. Not exactly what I'd expect from a company handling significant amounts of money in a market that's struggling to gain recognition and trust.

coinbase-craig 13y ago
On rare occasions we are not able to provide bitcoin at a locked-in price. When we can't, we offer the ability to place an order in USD for an amount of BTC equal to the exchange rate at the time that we receive your USD from the bank, 4 business days later. When this is offered as an option, we display a note on the buy page that says: "Note! We've exceeded our normal buy limits for today. If you would still like to purchase you will receive the market price of bitcoin on [some date] after your funds have arrived." You are also required to agree to a term like this before placing an order: "I acknowledge that the amount of BTC I receive will vary based on future exchange rates." Some users check the box without reading it; maybe this happened to you. We're trying very hard to scale our support team. We've gone from 1 to 12 support in a matter of months, and we are hiring more support staff, and it is still difficult to keep up. We are responding, but it is almost impossible to grow fast enough. That said, 10 days sounds way too long. If you send your coinbase email address to me at craig(at)coinbase, I'll get your ticket prioritized.
- tga 13y ago
  Thanks Craig, posting about my personal issue here feels a bit like cheating, but it was nice of you to jump in. I can imagine support is already a priority, but consider this my nudge about it.
  - ejhong 13y ago
    And also note that it is 3:30 am in San Francisco. Go to bed coinbase-craig!
- 13y ago

salient 13y ago

This is why the start-up environment sucks in Europe. It seems so (relatively) easy to get $20 million in US as a start-up, while it seems almost impossible to get that kind of money in Europe from an investor, which is why there are so many "winner takes all" companies from US and not from other places. This happens at a time when Bitstamp is several times bigger than Coinbase, also growing fast, and is covering both EU and US. Yet, because of this sort of funding (and probably more later), there will probably be yet again a US company dominating the scene. In a post-Snowden relevations time, I'm not very eager to continue using US services, but the environment seems to be so harsh for non-US companies that want to be global companies, and they basically have to grow themselves into global companies only through bootstrapping (the vast majority of them, I'm sure there are a few exceptions).

skrebbel 13y ago
Do most US investors care whether or not the companies they find are in the valley, or even on the same continent? (note: no value judgment here, I really don't know and I wonder)
- ig1 13y ago
  It depends on the VC and the size of the round, some VCs only invest in a very specific area while others are more flexible for larger investments. Most of the major VCs do invest internationally in larger rounds. For example in the last year Greylock invested in Wrapp (SWE), Sequoia invested in 6Wunderkinder (DEU) and Skyscanner (GBR), BVP in NewVoiceMedia (GBR), USV in Hailo (GBR) and FundingCircle (GBR), IA & Valar in TransferWise (EST/GBR), etc.
- nasalgoat 13y ago
  Yes, there is a massive bias against tech companies not in the Valley. My company, based in Canada, recently finished a $50M Series C road trip that included the Valley and New York, and the contrast between the two could not be any larger. The Valley VCs and investors were dismissive and incredulous that a Canadian company could achieve the success we had, and that we could find people "good enough" to make systems able to handle the kind of traffic we were running. They genuinely couldn't believe we'd done it outside of California. New York, however, was much more interested and receptive, and ended up being the best source for our future funding. This whole business is less about numbers and reality and more about feelings and who you know than anyone wants to admit.

wellboy 13y ago

This will be the third YC billion dollar company and 1 Bitcoin will be worth $50,000. Wait 1 year.

TimJRobinson 13y ago

I still wonder why I as a buyer would choose to buy through coinbase rather than PayPal or just credit card. For sellers it is awesome and I know how bad PayPal is for sellers so I understand that. But as a buyer if I don't care about being anonymous why would I spend a currency that is deflating and has no safeguards or way to charge back when I could just use fiat, have safety and feel better knowing the money I just spent won't be worth 10% more tomorrow.

phoboslab 13y ago
Porn. Though I'm wondering why Bitcoin adoption in the porn industry still seems to be so slow. Usually they're the first to jump on new technology.
- laichzeit0 13y ago
  I want to laugh but you're absolutely right. Military and pornography applications are the driving forces behind any successful technology.
- leokun 13y ago
  Eh, if you're trying to be anonymous your ISP is still tracking what you are watching. If you run a proxy on a server somewhere that provider is tracking it. If you're using anonymizing software your connection will be slow, but that might work. Also the websites that provide the type of content you're referring to like to gauge people with expensive subscription costs and I'm not sure how you can set up a subscription service with bitcoin.
  - phoboslab 13y ago
    But it doesn't show up on your banking statements where your spouse could see it. The "felt anonymity" is much higher, imho.
    - acjohnson55 13y ago
      Yeah....instead it just shows you've bought BTC, and if your spouse is at all sophisticated, they probably assume you're using it for something shady.

tocomment 13y ago

Would it be possible for CoinBase to have some kind of FDIC like insurance? It seems like that's the biggest problems with bitcoins these days is that there's no safe place to store them.

natrius 13y ago
The purpose of deposit insurance is to prevent runs on banks that make loans and don't have as much money in their vaults as the total of their customers' balances. Coinbase does not make loans. As far as I can tell, it's a service that stores your actual bitcoins for you. FDIC-style insurance isn't applicable.
- tocomment 13y ago
  Very good point. But I still think the bitcoin ecosystem is missing a foolproof way to securely store bitcoins in the way that US dollars have a bank. Paper wallets can get lost or stolen, A lot of online wallets get hacked, and DIY encryption doesn't seem like a great way to go either, especially for grandma. I'd happily pay a fee to coinbase in exchange for some kind of insurance against them being hacked.
  - natrius 13y ago
    Agreed. The bitcoin ecosystem will need traditional banks, credit cards, and the rest of the financial services industry. Prices that involve transfers will just be lower, and interest rates on deposits will have to factor in expected deflation once that stabilizes.
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bachback 13y ago

The major news here is that Bitcoin is corrupting itself by affiliating with major corporate interest. Silicon Valley thinks they own Bitcoin - they will be proven wrong. a fork is becoming more and more likely. Gavin is not treating his responsibilities well and should find himself a well paid job if he wants to make money. there is something wrong with incentives here. Bitcoin is global, not a US owned network.

vidarh 13y ago
Bitcoin is not one entity. When someone effectively "creates money" then of course there's a strong incentive for people to build businesses around it. Things can fork as much as it wants: Any alt-coin that becomes successful will attract people trying build businesses around it. If you want to prevent people from making money on it, find a means for people to achieve their goals without exchanging anything that can be converted into money. Good luck trying to do that without also making it pointless and/or unusable.
- bachback 13y ago
  I think you misunderstood what I was saying. I was referring to the fact that the core Bitcoin dev, basically the guy in charge of the network, joined the board of one company in Silicon Valley. If I have a competing business, what do you think his preferences are going to be? So if this continues there will be a fork, so that devs of the protocol are prevented from selling out. I think the core bitcoin devs are really going in a very wrong direction with their affiliations.
  - ashray 13y ago
    You are right. Bitcoins and bitcoin businesses in general have taken a very American twist. The entire 'bitcoin foundation' had turned into nothing more than a lobby group which is what Gavin happens to belong to. Large bitcoin businesses are dominate by Americans so far: Coinbase and Bitpay. Happy that Bitstamp isn't US owned but not sure for how long. It's basically a repeat of what happened with the Internet. No one is stopping other regions from taking their own slice of the pie. It just appears that Americans are quicker on the innovation front and seem to understand where future value may lie and thus take appropriate risks.

loceng 13y ago

I'm wondering how much of this money is invested in Bitcoin itself - how much Bitcoin Coinbase is holding onto or own. It is a smart way for investors to start gathering Bitcoin.

ashray 13y ago
I honestly doubt that much of this is going into buying and holding bitcoins. Institutional investors are already trading big numbers of bitcoins via Second Market. They don't use regular exchanges and certainly wouldn't need to go through the 'false investment' route. I do however think a large part of this would go towards Coinbase improving its bitcoin stash. They've been running out of stock every single week.
pbreit 13y ago
Probably zero if Coinbase is operating above board (which I assume it is).

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jroseattle 13y ago

I question how far the Bitcoin industry can develop without government regulatory agencies getting involved. Granted I don't have a deep background in financial systems, but this seems like more than a remote possibility. I see a parallel with Bitcoin and the financial system to Uber & Lyft with traditional taxi/limo services. In Seattle, both Uber & Lyft are being hassled by the city since they don't fall under the regulations that apply to taxis and limousines. And truth be told, I think that Uber & Lyft are going to see the regulatory matters eventually impact their operation, rather than going away. And that's just working at a local level. Payment systems on a worldwide scale? Seems commensurately high-risk, high-reward at present, where the "high" measurement is significant.

wmf 13y ago
Bitcoin is already regulated by FinCEN, although AFAIK none of the startups are compliant with the regulations.
- cdash 13y ago
  Sure, it is regulated by FinCEN but what does that do for me? It seems FinCEN is nothing more than a part of the national security theatre than actually regulations that help me.
- jackgavigan 13y ago
  > Bitcoin is already regulated by FinCEN... Technically it's not. FinCEN regulates money services businesses and they have decided that people/companies who exchange virtual currencies for USD are in the money services business. It might sound like nitpicking but it's an important distinction.

7Figures2Commas 13y ago

Bitcoin needs more effective mainstream marketing and with $25 million in depreciating dollars, I really hope that Coinbase is the entity that brings Bitcoin to the masses. I would strongly suggest that Coinbase do an endorsement deal with William Devane and start buying ad spots on FOX News. The script is simple. William rides up on a horse and tells viewers: I just feel so much more secure knowing that I own Bitcoin. And you can't print Bitcoin. Don't you just love the feel of Bitcoin? I buy my Bitcoin from Coinbase, because I trust them. No gimmicks. Coinbase will beat any price of any Bitcoin and at any time. Just call em. And Coinbase transfers my Bitcoin in 10 days or less, faster than anyone else. So protect yourself from the problems of the world. Invest in volatility with Coinbase. With such a compelling commercial[1], there's no reason we couldn't see BTC $1 million. [1] http://www.youtube.com/watch?v=QCJCcnhbmr0 http://www.youtube.com/watch?v=QCJCcnhbmr0

applecore 13y ago

That's about 29,000 bitcoins at today's price.

crassus 13y ago

Does coinbase have any intention to switch to a smaller bitcoin denomination at any bitcoin price?

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pdknsk 13y ago

I wonder if the "12 Days of Bitcoin" on Bloomberg played a tiny part in this. I was watching a segment the other day which had one of the reporters talk about purchasing BTC and mention that Coinbase is very reputable. http://www.bloomberg.com/video/12-days-of-bitcoin-what-do-you-need-to-buy-one-orjc75uLSpmMSbJDGB6Fkw.html http://www.bloomberg.com/video/12-days-of-bitcoin-what-do-yo...

hoka 13y ago
Doubtful, I think. Raising venture rounds of any size (especially this one) takes a very long time! Bloomberg may have caught wind of the deal, however, and chose to release the story to capitalize on the press trend.

joering2 13y ago

I gave up multiple times on purchasing Litecoins. All I want to do is securely use my american credit or debit card to purchase 200 litecoins at reasonable price and fee. In the world run by bitcoin, is that too much to ask?

aianus 13y ago
I think the simplest way to buy litecoins as an American is to buy bitcoins using coinbase and then exchange them for litecoins on btc-e.
scintill76 13y ago
It would probably be easiest to buy bitcoins with Coinbase and trade them for litecoins at an exchange. You are going to have a hard time buying any cryptocurrency with a card, because it is too easy for you to reverse the charge and take the irreversible cryptocurrency. The places that let you buy bitcoins with cards are a lot more expensive for this reason.

kolev 13y ago

I both love and hate Coinbase! So far, they've cost me hundreds of dollars. Some may consider it stolen money. I understand the technical issue, but I'm sure when they get adopted by a wider and not-so-technical audience, they may become a target of a nasty class action lawsuit. For example, I bought several times Bitcoin with them, you see the price, then you get a popup to confirm (sometimes the popup shows a different price than what you originally got, but that's fine as it's confirmation page), you hit the button and guess what - after looking in your transaction history, you see you got charged sometimes tens, sometimes - hundreds of dollars more. Basically, the price moved, and they charged you a different amount. No warning, no nothing. Again, I understand why this is happening, but they make enough (1%) to honor the price. As I suspect, sometimes they sell from their own inventory of Bitcoins, so, they don't depend on the market order.

jackgavigan 13y ago
> ..I bought several times Bitcoin with them, you see the price, then you get a popup to confirm (sometimes the popup shows a different price than what you originally got, but that's fine as it's confirmation page), you hit the button and guess what - after looking in your transaction history, you see you got charged sometimes tens, sometimes - hundreds of dollars more. Basically, the price moved, and they charged you a different amount. No warning, no nothing. That's shocking (if true). Recording trades at a price that's different from what the user saw on their screen when they clicked to commit to the trade is pretty fundamental fuck-up. It's a "Drop EVERYTHING! We need to fix this NOW!" kind of problem. There's a good chance that someone's head would roll if it happened in an investment banking/capital markets-type environment. I know for certain that if it was happening with a bank's online payments service (the sort of thing where you can send EUR from your USD bank account), the service would simply be switched off until the problem was fixed. You'd have to get the legal department involved to notify the regulator and assess the company's liability. You'd have to go through the logs to find every single instance of it ever happening and write to each and every customer who was disadvantaged to inform them, apologise and reimburse them. And there'd be a significant fall-out, with very senior people asking "How the fuck could this happen?!" I get the impression that some Bitcoin startups have a lot of growing up to do.