Coinbase Considers Offering Tokenized COIN Shares to US Users through Ethereum Layer-2 Network, Base

Coinbase, the largest cryptocurrency exchange in the United States, is reportedly considering offering tokenized shares of COIN stock to domestic users via its Ethereum Layer-2 network, Base.

This move could combine traditional stocks with blockchain technology, putting Coinbase ahead in financial innovation.

Coinbase is still in the early stage of exploring this initiative, and regulatory compliance is the main obstacle. However, the exchange is committed to addressing these challenges to ensure a secure and lawful rollout of tokenized assets, according to Jesse Pollak, Base’s lead developer.

“We are in an exploratory phase and working to understand what needs to be unlocked from a regulatory perspective to bring assets like $COIN to Base in a safe, compliant, future-looking way,” Pollak told Blockworks.

Currently, tokenized COIN shares are only available to international users through decentralized platforms. Pollak said that expanding this access within the US hinges on clearer regulatory guidelines. Moreover, such advancements could open the door for blockchain-based financial systems to a broader audience.

“We’re starting with the first tokenized stock, but this is the beginning of a much larger story where we’re going to bring the next generation of financial products to Base,” Pollak added.

Meanwhile, Pollak hinted that the tokenized COIN stocks could be the first of many such products on the Base network. Over the past year, the Ethereum Layer-2 network quickly gained traction and became a significant player in the industry, with over $3.84 billion in total value locked (TVL).

The Base lead developer is confident in the platform’s potential to reach $1 trillion in managed assets, which would further cement Base’s role as a hub for next-generation financial solutions.

“We are going to bring $1 trillion assets to Base and it’s going to happen faster than anyone expects,” Pollak said.

Coinbase is the first publicly traded crypto exchange in the US, with a market capitalization of around $70 billion. Austin Campbell, an adjunct professor at Columbia Business School, recently praised the firm for its pivotal role in resisting what he called excessive regulatory overreach against the crypto industry in the US.

“Coinbase is the first crypto exchange that went public in the US, and they’ve been playing a key role in resisting what I see as excessive regulatory overreach against the crypto industry,” Campbell told Blockworks in an interview at the Converge23 conference in San Francisco on March 28.

“They’ve been pushing back on the SEC’s attempts to classify crypto assets as securities, which would subject them to burdensome regulations that are not designed for digital assets or the crypto markets,” he added.

On the other hand, as the crypto exchange prepares to offer tokenized COIN shares in the US, it faces competition from decentralized platforms that already provide this service to international users.

These platforms, such as Uniswap and SushiSwap, allow users to trade tokenized versions of various stocks, including Tesla, Amazon and Apple. However, the legality of these offerings remains unclear, especially within the US jurisdiction.