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BESNear the foot of San Francisco’s California
Street stand the august stone pillars of a
bank dating to the 19th century.
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FORBES.COM MARCH 20 2062
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A few paces away sit the offices of Coinbase, the
largest American exchange for cryptocurren-
cies like bitcoin. It’s a beehive of software engi-
neers and young marketing executives. There,
the worlds of by-the-books banking and crypto-
anarchism collide.
In style and philosophy, Brian Armstrong,
the 37-year-old billionaire cofounder and CEO
of Coinbase, is in the camp of the financial an-
archists. He sits, jammed alongside lieutenants,
in a row of tiny desks resembling library carrels.
He wears a black T-shirt, black pants and shiny
white sneakers. He talks about a brave new world
in which we are liberated from the shackles of
giant banks and government-controlled mon-
ey supplies. During an expansive interview, this
usually reserved and press-shy entrepreneur de-
clares why he got into this business: “I wanted
the world to have a global, open financial system
that drove innovation and freedom.”
In following a business model, though, Arm-
strong fits in with the pinstriped financiers work-
ing down the block. Eight years after its start, his
firm has opened 35 million accounts, presides
over $21 billion of assets and is on target, we es-
timate, to top $800 million in revenue this year.
That success comes from acting like a bank.
Coinbase draws in customer funds via bankwires. It stores its assets—numerical keys
that unlock coins—in vaults. It boasts of
insurance coverage from Lloyd’s of Lon-
don. It has a security staff of 41, including
an Iraq War veteran assessing perimeter
risks and a Ph.D. cryptographer doing the
same for mathematical assaults.
The selling proposition here is securi-
ty—security conspicuously lacking at some of the exchang-
es with which Coinbase has competed. The Mt. Gox ex-
change in Japan went bust in 2014 after hackers spirited
away coins worth $480 million. Customers of QuadrigaCX,
which was one of Canada’s largest exchanges, have been
unable to retrieve $150 million in crypto since the founder
supposedly died suddenly in December 2018, holding the
only set of keys to unlock their money. They now want the
body exhumed.
In order to capture a gilt edge, though, Armstrong has
had to veer away from the antiestablishment ethos that gotChange Agents
Chief operating
officer Emilie Choi
(left) and chief
financial officer
Alesia Haas
at Coinbase in
San Francisco’s
Financial District