Coinbase’s 12,652 ETH Sale: The Crypto Move No One Expected (Or Did They?)

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What you need to know (unless you’ve already figured it out):

  • Coinbase’s Base creates a lovely little demand for ETH, which is then transformed into dollars—like magic, only with a lot more paperwork, according to Standard Chartered’s Geoffrey Kendrick.
  • In Q4, Coinbase decided to part ways with 12,652 ETH, which seemed like a good idea at the time. I mean, who wouldn’t want to sell some crypto after a nice price bump?
  • Kendrick argues that Coinbase isn’t a long-term ETH hoarder. They sell, and they sell strategically, like a crypto version of a well-timed stockbroker.
  • Coinbase insists they only sell when absolutely necessary—mainly to keep the lights on and avoid running out of funds for things like paying people and buying more things.

Coinbase (COIN) sold a rather impressive 12,652 ether in Q4, which, at today’s rate, would fetch a cool $25 million—though it was worth double that at the time, according to Geoffrey Kendrick, who seems to be pretty good at math. He’s also the head of digital assets research at Standard Chartered Bank, which sounds fancy, so you can trust him.

Kendrick, having deep-dived into Coinbase’s quarterly filings (because someone has to), concluded that Coinbase holds ether (ETH) under various categories: some for investment, some for operational purposes, and some for just throwing a crypto party. He estimates that around 80% of the revenue generated by Base—the Ethereum layer-2 blockchain Coinbase loves—is pure profit. That’s like finding money in the couch cushions, only it’s much harder to spend ETH at the grocery store.

And oh, the timing! According to Kendrick, Coinbase timed its trades with impeccable precision: they bought more ETH in Q3, when it was a bargain at $2,500, and sold in Q4 when the price soared to $4,000. Now ETH is back down to around $2,000. Talk about catching the highs and lows—Coinbase, you sly dog.

“They bought low in Q3 (which, let’s face it, is when you should buy), and sold high in Q4 (because duh),” Kendrick writes, probably while sipping on a delicious cup of trader’s irony.

Coinbase, naturally, insists it wasn’t running a covert crypto hedge fund. No, no, it sold ether purely for operational reasons, like paying bills, taxes, and whatever other delightful things you have to pay for when you’re running a gigantic digital asset exchange. “But we’re not trading,” they said, as if that makes it all better.

“Base earns ETH from sequencer fees, and the ETH we earn is mostly kept for long-term investment or used to fund operations,” a Coinbase spokesperson clarified, probably while balancing their checkbook in a very crypto-centric way.

As Kendrick saw it, Coinbase’s strategic selling is becoming a bit of a trend. Over the past three quarters, net ETH sales amounted to 1,558—because why hang onto something when you can sell it for a nice profit and still have enough to fund your next big idea? Kendrick believes this pattern isn’t about accumulating wealth but just taking profits when they’re available. Smart.

However, Coinbase was quick to assure everyone that they don’t typically dabble in crypto trading for kicks. “We don’t trade for fun. But sometimes we do lend our assets out or stake them, like responsible adults,” the spokesperson added, quoting from their ever-popular 10-K filing. So much for spontaneous crypto trading parties.

This isn’t the first time Coinbase has had to deny it’s secretly running a crypto trading empire. Last month, a member of Base—because we all trust Base members—squashed rumors, saying Coinbase had “accumulated $300M+ in ETH,” which, apparently, is more than two times what Base has ever earned in ETH. So there! Coinbase is just a humble operator, not a crypto profiteer.

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2025-03-20 12:33