With its recent deal with Google, crypto exchange Coinbase could be setting a precedent for other crypto-based companies looking to work with traditional firms, according to Owen Lau, senior analyst at investment firm Oppenheimer.
He told CoinDesk TV Coinbase's partnership with the tech behemoth is also a sign of “validation” for the digital assets industry.
“Many crypto-native companies will go after these white-labeling paths, which is to provide the back-end crypto technology surfaces to traditional players so that they can expand their TAM,” or total addressable market, Lau said during an appearance on CoinDesk TV’s “All About Bitcoin” on Tuesday.
Earlier this week, Google said it would be tapping Coinbase, the second-largest crypto exchange by volume in the world, to accept crypto payments via Coinbase’s custody service, Coinbase Prime. Google is turning to Web3 in a bid to build out speed and interoperability for users.
The partnership, which will begin next year, will give users the option to pay for Google’s cloud services via the use of select cryptocurrencies, such as bitcoin (BTC), ether (ETH) and even dogecoin (DOGE).
Meanwhile, Coinbase’s Cloud Nodes will migrate its applications, which primarily operate on Amazon’s Web Services, over to Google Cloud.
Oppenheimer has a “buy” and an “outperform” rating on Coinbase’s stock, with a price target of $107.
“Coinbase is more [of] a digital assets enabler rather than a pure-play crypto exchange,” Lau said, referring to the exchange’s audit capabilities, including its commerce, custody and international business footprint. The company recently received a license to begin operating in Singapore.