One of Coinbase's (COIN 7.66%) goals is to provide end-to-end seamless capabilities for users. In this video clip from "The Crypto Show" on Motley Fool Live, recorded on March 23, Fool.com contributors Travis Hoium and Chris MacDonald discuss the intriguing new feature that the cryptocurrency exchange is adding to its platform.
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Travis Hoium: Yeah. They're adding support for Solana (SOL 7.15%), the Solana blockchain for their wallet. To just take a step back, Coinbase is the exchange. If you have a Coinbase account and you log into Coinbase, that is not the Coinbase wallet. You can connect those, but the wallet is actually where you get the goofy 12 words and you have to remember what those are. It's basically your own wallet. You can even access it with MetaMask.
But they have to basically build the capability to access different blockchains into that wallet. Coinbase is a very popular wallet. MetaMask is a very popular wallet for the Ethereum (ETH 0.57%) blockchain. Something like Phantom will be more popular and more well-known for Solana itself. What Coinbase is doing is saying, we're going to add support for Solana to the Coinbase wallet. Now if you're a Coinbase user, you can connect your Coinbase wallet. They're having some interesting integrations there with Coinbase pay. We're going to try to make that a little bit more seamless. Then we're going to allow you to access all of these different networks.
For me personally, I use a few different wallets because I have NFTs on Ethereum and I have NFTs on Solana. Right now I can't use the same wallet for those, so I'm logging into two different wallets depending on where I'm trying to go online in these Web3 ecosystems. That is a really compelling use case as we have more and more users enter the space and have more and more utility and NFTs being built.
You are really seeing the vision here for Coinbase. They want to be a one-stop shop for everything in the Web3 cryptocurrency space, adding support for Solana. We've talked a couple of weeks ago about trading for some of the Solana tokens that are out there, not just Solana itself, but the tokens that live on top of Solana. This is just another step in that direction. I think we'll probably see more.
Right now, I will note that, if you have NFTs that you need to connect your wallet to access something on the website, Coinbase wallet is not going to be an option for that for a while. Still, if you're on Solana, you have Solana NFTs, something like the Phantom wallet is going to have provide better functionality.
But in time they will add that. That is something that's coming down the road. If it gets adoption, this is a really compelling use case for their wallet and could give them another leg up. We're building this ecosystem. They've got all the things together. Just another reason to be bullish on Coinbase long term, I think.
Chris MacDonald: It's definitely an interesting integration to focus on the wallet aspect, but also the Coinbase Pay aspect and Coinbase is trying to be the vertically integrated crypto company out there, providing end-to-end seamless capabilities for users, which I think right now makes sense with the transition maybe from those who are super tech-savvy and were around at the beginning to the average layperson. This is an interesting move for sure.
Hoium: In the Coinbase Pay thing, I want to just cover that quickly because I looked at that this morning on my own accounts, and what that basically does is just integrates the wallet with the Coinbase app. Now, the process, previously, let's say you wanted to buy an NFT on OpenSea, so you're using Ethereum. You'd have to buy Ethereum in Coinbase. You have your Coinbase account connected to your bank account, buy some Ethereum there, and then send it to your wallet, and then you buy the NFT from your wallet. It's this complicated transaction.
Now, what they're trying to do is basically to say, hey, just open up your wallet. You're connected to your Coinbase account. Buy $500 worth of Ethereum and boom, you're done. Making that, just like Chris said, I think the case for Coinbase is as we move from all these people who are writing code and memorizing numbers and things like that, we want to be at the point if you're bullish on cryptocurrency where the average person can use this and it's as simple as using something like a smartphone. Because otherwise adoption just isn't going to get to hundreds of millions and billions of users. That's really what Coinbase is trying to answer there.