By Anna Irrera and Tom Wilson
LONDON (Reuters) – As Coinbase Global Inc’s multi-billion dollar stock market listing accelerates cryptocurrency’s leap to the top table of finance, its founder and CEO Brian Armstrong is poised to reap the benefits of the company’s nine-year journey.
Armstrong owns 21.7% of the San Francisco-based cryptocurrency exchange, filings show – a stake worth around $20 billion given Coinbase’s projected value.
Such a paper fortune might have been hard to imagine when Armstrong founded Coinbase in 2012, just four years after bitcoin was invented by the pseudonymous Satoshi Nakamoto.
Bitcoin’s peak that year of just $16 reflected the fact that knowledge of cryptocurrencies was mostly limited to online enthusiasts. On Wednesday it set its latest high of nearly $65,000.
Yet some who met Armstrong during Coinbase’s early days spoke of his understanding of how cryptocurrencies could jump from obscurity to the mainstream.
“I remember meeting Brian in 2013/2014,” said Tom Glocer, an early Coinbase investor and former CEO of Thomson Reuters. “Brian had a well-formed, mature vision of the key elements that needed to be built to bring crypto into mainstream finance and commerce.”
56 MILLION USERS
Since its founding Coinbase has grown rapidly with the rise of bitcoin. It now boasts 56 million users globally and has an estimated $223 billion of assets on its platform, an 11.3% market share of total crypto assets, regulatory filings show.
As bitcoin more than doubled in price in the first quarter of the year, Coinbase estimated revenue of over $1.8 billion and net income between $730 million to $800 million, versus revenue of $1.3 billion for the whole of 2020.
Armstrong, a software engineer who previously worked at Airbnb Inc and also as a consultant at Deloitte & Touche, was paid a salary of $1 million in 2020, with additional stock options and other compensation worth $58.4 million, regulatory filings show.
Coinbase Chief Financial Officer Alesia Haas described Armstrong as a visionary who has been able to focus on building the company through both the ups and downs of the crypto market over the past few years.
“Brian is the glue that keeps us all focused,” Haas said in an interview with Reuters. “He has a wonderful demeanour when things get tough.”
Coinbase has weathered bitcoin’s many swings in price and unlike many major cryptocurrency exchanges, it has so far avoided the hacks and heists that have been associated with the sector.
Yet Armstrong and his company have faced other controversies.
Last year, after a flood of U.S. companies vowed to tackle racial inequality following the death in police custody of George Floyd, a Black man, which ignited protests across the country, Armstrong blogged that Coinbase would remain apolitical.
The stance was at odds with moves by other major U.S. brands and Silicon Valley startups, leading to discontent among some employees. Coinbase offered a severance package to those unwilling to accept the policy.
“It has become common for Silicon Valley companies to engage in a wide variety of social activism, even those unrelated to what the company does, and there are certainly employees who really want this in the company they work for,” Armstrong wrote.
A Coinbase spokeswoman declined further comment.
(Reporting by Anna Irrera and Tom Wilson; Editing by David Holmes)