Coinbase CEO Reflects on Bitcoin Reserve Strategy That Was Deemed ’Too Risky’

Coinbase CEO Brian Armstrong recently revealed that the cryptocurrency exchange once considered allocating a significant portion of its balance sheet to Bitcoin but ultimately decided against it due to volatility concerns. The decision, which could have had major implications for the company, highlights the challenges of managing risk in the crypto industry.

Coinbase CEO Reveals Bitcoin Reserve Strategy Was Deemed ’Too Risky’

Coinbase CEO Brian Armstrong disclosed that the exchange considered allocating 80% of its balance sheet to Bitcoin but ultimately rejected the idea due to volatility concerns. "It could have killed the company," Armstrong admitted during a customer Q&A session, referencing Coinbase’s early-stage vulnerability to market swings.

The revelation came as executives addressed whether Coinbase missed an opportunity to emulate Strategy’s aggressive bitcoin accumulation. Armstrong defended the caution, emphasizing survival over speculative gains during the platform’s formative years.

Coinbase Stock Surges on S&P 500 Inclusion Announcement

Coinbase Global Inc. shares rallied in extended trading after S&P Dow Jones Indices revealed the cryptocurrency exchange will join the S&P 500 index effective May 19. The stock climbed 8% to $225 in after-hours activity following a 4% gain during the regular session.

The inclusion marks a significant milestone for the crypto industry, reflecting growing institutional acceptance of digital asset enterprises. Coinbase replaces Discover Financial Services in the benchmark index as Capital One prepares to finalize its acquisition of the payments firm.