Speaking on a panel Wednesday about the evolution of cryptocurrency capital formation at CoinDesk’s Invest: Asia conference, Pirestani said an initial exchange offering (IEO) platform is one of several capital-formation tools currently being explored by Coinbase.
San Francisco-based cryptocurrency exchange Coinbase may soon issue a proprietary exchange token, according to Coinbase’s head of institutional sales in Asia, Kayvon Pirestani.
IEOs have already been supported by most other major exchanges including Bitfinex, Binance, OKEx and KuCoin. Not unlike an initial coin offering (ICO), an IEO is another crowdfunding tool for cryptocurrency startups.
It relies on an exchange to act as the trusted broker offering the token sale – with each exchange issuing its own proprietary token (such as Binance’s BNB) to execute the sale. It usually requires a commitment from the exchange to handle know your customer (KYC) and anti-money laundering (AML) checks on a startup’s behalf.
“We think there’s a really interesting opportunity there for Coinbase”, said Pirestani, adding:
“In a nutshell, Coinbase is carefully exploring not only the IEO space but also STOs security token offerings. But I can’t make any formal announcements right now.”
While Pirestani said news about a potential Coinbase IEO platform may emerge in the “next few months”, plans for regulated securities offerings in the U.S. are less far along.
Announced in July 2018, Coinbase received regulatory approval to acquire several securities firms with broker-dealer licenses including Keystone Capital Corp., Venovate Marketplace and Digital Wealth LLC.
About these plans, Pirestani affirmed that broker-dealer licenses have been obtained by Coinbase, but they’re “still digesting” the acquisition and “repurposing” the respective licenses.
Pirestani also noted that security tokens are “talked about a lot but traded much less” and that Coinbase would wait for more market demand to roll out an STO product.
CoinGecko Releases ‘Trust Score 2.0’ to Boost Crypto Exchange Transparency
Market data aggregator CoinGecko has upgraded its “Trust Score” metric in a bid to bring more transparency to the crypto trading environment.
The company’s re-tooled scoring system will evaluate global cryptocurrency exchanges using more complex metrics, beyond just liquidity.
Speaking on stage at CoinDesk’s Invest: Asia event in Singapore, CoinGecko co-founder Bobby Ong said the firm has significantly increased the number of exchanges it is tracking, going from 45 exchanges 18 months ago to 363 now – a growth of 706 percent.
CoinGecko first revealed the Trust Score system in May 2019 in order to combat fake trading volume among cryptocurrency exchanges.
The new upgrade to the scoring system, now called Trust Score 2.0, will look at four additional major measurements, including exchanges’ API technical coverage, scale of operations, estimated cryptocurrency reserves and regulatory compliance.
“With the launch of Trust Score 2.0, progress is being made to promote transparency amongst cryptocurrency exchanges”, CoinGecko co-founder TM Lee said in a statement. “We look forward to innovating further to better evaluate cryptocurrency exchanges based on a comprehensive set of data.”
With the new scoring system now live, CoinGecko has identified the top five crypto exchanges, according to its metrics. They are: Binance, Bitfinex, Bittrex, Poloniex and Coinbase Pro.
In a blog post released Wednesday, CoinGecko explained that 50 percent of its Trust Score 2.0 is based on exchanges’ liquidity, with 20 percent on technical coverage and 30 percent on scale of operations.
“Cryptocurrency Reserves and Regulatory Compliance categories are not included in the overall Trust Score 2.0 calculations for now but are considered candidates for inclusion in future Trust Score algorithm updates”, the company said in the post.
For the estimation of cryptocurrency reserve and regulatory compliance, CoinGecko said it’s working with Bitfury and Coinfirm, respectively.