Coinbase Takes On Robinhood With Stock Trading: What The Everything Exchange Means For Your Money
Coinbase Global Inc. (NASDAQ:COIN) just made a bold play that changes the trading platform game. The crypto exchange announced Wednesday at its System Update event in San Francisco that it’s launching traditional stock trading, complete with 24 hour access five days a week and zero commissions. Translation? Coinbase wants to be your one stop shop for everything from Bitcoin (CRYPTO: BTC) to Apple Inc. (NASDAQ:AAPL) shares.
But here’s the real question: Can a crypto focused platform actually compete with Robinhood Markets Inc. (NASDAQ:HOOD), which already owns this space? And more importantly, what does this mean for where you park your trading account?
The David Vs. Goliath Setup
Let’s start with the uncomfortable truth. Robinhood’s market cap sits at roughly $107 billion right now, while Coinbase clocks in around $66 billion. That’s a 60% valuation gap, and it exists for a reason. Robinhood has years of experience executing stock trades, a massive user base that trusts it for equities, and it’s already integrated crypto without messing up its core business.
Coinbase’s announcement sent its shares up about 1% in after hours trading Wednesday. Interestingly, Robinhood also climbed 1.5% after hours, which tells you the market isn’t panicking about Coinbase stealing Robinhood’s lunch money anytime soon.
The timing matters though. Coinbase shares have dropped nearly 8% over the past month as crypto tumbled, even though the stock’s still slightly positive for the year. When Bitcoin tanks, Coinbase’s revenue evaporates because the company makes most of its money from trading fees. Stock trading gives them a hedge against those painful crypto winters that gut their business every few years.
The Tokenization Play Everyone’s Missing
Here’s where things get interesting, and frankly, where Coinbase’s real bet lives. CEO Brian Armstrong told CNBC that traditional stock trading is just the opening move. What he actually wants is tokenized equities, stocks that live on blockchain networks instead of through traditional exchanges.
Think about what that could mean. Stocks trading 24/7, not just during market hours. Near instant settlement instead of waiting two days for your trades to clear. Lower costs because you’re cutting out middlemen. It’s the kind of market structure change that could actually matter, not just another incremental improvement.
Coinbase is already seeking SEC approval for blockchain based stocks. Early next year, they’re rolling out perpetual futures for stocks, available outside the U.S. These are derivatives …
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