Coinbase Acquires Paradex, Moves Ahead With Coinbase Pro
Coinbase, the largest and most prominent U.S. cryptocurrency exchange, announced its acquisition of the trading platform Paradex. Paradex is a decentralized exchange that allows users to trade hundreds of coins peer-to-peer directly from their wallets, in contrast with Coinbase’s centralized platform that holds tokens on behalf of its customers.
This acquisition continues Coinbase’s trend of expanding beyond the four tokens offered on their service – Bitcoin, Bitcoin Cash, Ethereum, and Litecoin. Coinbase currently only offers these currencies because of the regulatory uncertainty about which tokens must be registered as securities.
Paradex allows users to rely on smart contracts to trade tokens and record the transactions on the blockchain. Coinbase is excited about the smart contract technology, and believes the acquisition will bring them a different pool of users, and gives their current customers access to lesser-known tokens.
Coinbase reiterates in a blog post that, “this peer-to-peer trading removes the need for third-party custodianship and the associated security risks,” and that, “It is another step toward creating a truly decentralized crypto economy.” It is clear the San Francisco based company wants to move away from the centralized model so that they can offer more digital tokens to their users.
Paradex will be suspending its app as of Wednesday to integrate its services with Coinbase. Initially, only customers outside of the U.S. will be able to use the Paradex services, but they will eventually offer these services to U.S. customers after changes for compliance purposes.
The company also revealed a new brand called Coinbase Pro that will replace its current professional investor platform GDAX. The platform will feature a new design, chart features, and a whole new suite of services to attract more institutional investors. GDAX will be retired at the end of June, and all customers will be rolled over to the new service.