The second week of October came with notable news and developments for San Francisco-based cryptocurrency exchange Coinbase (NASDAQ: COIN) after the announcement that the crypto company had secured an in-principle approval (IPA) in Singapore made rounds.
This time around, the cryptocurrency exchange has partnered with Google Cloud, a move that will allow Google (NASDAQ: GOOGL) to begin accepting cryptocurrency payments for its cloud services in early 2023.
In this article, you’ll be briefed on the following:
- All you need to know about the Google Coinbase partnership.
- What this partnership could mean for both parties.
- Google’s increasing foray into crypto and blockchain.
- How blockchain and crypto are becoming increasingly coveted.
Source – Google Images | Google Cloud x Coinbase
Google coinbase partnership
Announced on October 11, 2022, at Google’s Cloud Next conference, the tech giant will begin accepting crypto payments through integration with Coinbase.
Speaking at the event, Google Cloud Vice President and General Manager Amit Zavery noted that this integration will occur through Coinbase Commerce, a crypto-based payment platform for merchants, and will only be available for a select few when the project launches in 2023, and will include Bitcoin (BTC), Ethereum (ETH), Litecoin (LTC), Dogecoin (DOGE), and Bitcoin Cash (BCH).
However, Zavery added that, with time, the payment functionality would be available to more Google customers.
In a competitive market that is expanding quickly, where Google’s major competitors do not yet allow customers to pay with digital currencies, the partnership aims to attract cutting-edge businesses to Google.
For several months now, the cloud division of Google has helped the parent company, Alphabet (NASDAQ: GOOG), diversify its focus from advertising. The cloud business now accounts for 9% of the company’s total revenue, up from 6 % in 2019. Reports show that the cloud division is expanding at a faster pace than Alphabet as a whole.
Following the announcement, Coinbase shares jumped by over 8% in the trading session on October 11, though the stock trades down by 70% on a year-to-date (YTD) basis.
Source – Google Finance | COIN
Goodbye AWS; Coinbase Moves to Google Cloud
The newly-penned partnership came with the condition that Coinbase migrates all cloud-hosting requirements from Amazon Web Service, which the crypto exchange has relied on for several years, to Google’s cloud infrastructure, according to Jim Migdal — Coinbase’s vice president of business development.
As part of the partnership deal, Google will also employ the use of Coinbase’s custody service, Coinbase Prime — a crypto service that securely maintains the cryptocurrency holdings of large businesses and organizations and allows them to carry out trades. That said, the terms of the partnership deal have yet to be made public at the time of writing.
Commenting on his institution’s latest partnership, Thomas Kurian, the CEO of Google Cloud, stated: “We want to make building in Web3 faster and easier, and this partnership with Coinbase helps developers get one step closer to that goal.”
Source – YouTube | Google Cloud’s Thomas Kurian
The Coinbase x Google Deal had Been in the Works for a While
While the partnership is now a reality, it wasn’t guaranteed that Google would go with Coinbase for the payments part of the deal. Google Cloud VP Zavery noted that at some point, PayPal was in consideration, considering it offered businesses an avenue to make payments using digital currencies. Zavery said, “We did look at other companies for the cryptocurrency side of it,” but ultimately decided to go with Coinbase because it had the “greatest capability.”
With Google considering using Coinbase Prime, the giant tech company could likely acquire some crypto assets soon. Zavery revealed at the conference that Google was experimenting to “see how we can participate” in managing cryptocurrency assets.
Meanwhile, Google previously noted that it was considering the prospect of incorporating support for payments made with digital currencies in May. Coinbase’s Migdal said that the company had been holding talks with Google for several months, with the Prime service, cloud computing, and enabling commerce transactions all being discussed concurrently. He added that “we decided to bring them together.”
Crypto Investing is Risky Business
In the past few years, several notable tech companies, such as Block (formerly Square), Coinbase, MicroStrategy, and Tesla, have added crypto assets to their balance sheets. However, this can be a risky venture, given the ongoing downturn in the broader cryptocurrency market. In August, Coinbase announced a $377 million impairment charge relating to the drop in value of its crypto holding, while Tesla more or less liquidated a large portion (75%) of its Bitcoin holding.
Meanwhile, instances of Stablecoins losing their dollar peg and major cryptocurrencies trending downward have caused the general cryptocurrency market to take a significant hit this year. At press time, Ethereum is down 60 percent in 2022 despite The Merge, an attempt to make the cryptocurrency’s network more energy-efficient, while Bitcoin is down 54 percent as it struggles around $19,000.
Source – TradingView | Total Market Cap Weekly Chart
Sharing his thoughts on the latest partnership and how it could influence the crypto market,
Now that the google cloud platform has opened its doors to accept cryptocurrency as mode of payment, customers will start exploring this different tender, and see the convenience of paying with it. This first platform which will be integrated with such is the Coinbase Commerce Service. Hence through time, Google will also start accepting diversified cryptocurrencies, such as Bitcoin, Dogecoin, Ethereum and Litecoin. This will definitely warm up the crypto winter and can be a gateway for this crypto winter to end.
Crypto winter have been a huge predicament for crypto traders, but as borders start to loosen up, and so are windows to more opportunities for the crypto to penetrate the financial market. We’re also expecting a huge bullish run now that dollar prices are increasing too, and investors are looking for safe currencies to purchase. Here, with google supporting cryptocurrency, investors will definitely rush to the market given the effects of crypto winter still felt.James Page, Crypto Head
Google coinbase partnership: Google’s Budding Interest in Cryptocurrency, Blockchain, and Web3
Google, the world’s largest search engine company, has recently acquired a taste for crypto, blockchain technology, and Web3. Alphabet has reportedly invested $1.5 billion in multiple Web3 and blockchain companies, such as Dapper Labs and Alchemy.
Also, in January this year, Google onboarded former PayPal executive Arnold Goldberg to spearhead explorations on cryptocurrency as a payment option.
Meanwhile, in September, Sky Mavis — makers of the P2E NFT game Axie Infinity — got into a partnership deal with Google Cloud to assist the blockchain project in properly securing its Ronin network and serve as an independent validator. This deal was said to be prompted after Sky Mavis lost roughly $600 million to hackers in a network vulnerability.
Thomas Kurian, head of Google’s cloud division, has previously advocated for expansion in important sectors, including media and retail. Some months back, the company announced the creation of special teams to promote blockchain technology-related businesses and create tools that can be used by non-blockchain developers to deploy blockchain apps.