Coinbase Acquires Crypto Start-Up Zabo – What This Means for Coinbase Users

U.S. cryptocurrency exchange Coinbase made headlines in August when it scooped up Zabo, a Dallas-based startup that lets users see the overall perspective of their investments in one place by connecting data across multiple venues.

Zabo’s API is similar to those offered in the mainstream financial services industry by providers like Plaid and Yodlee. Specifically, the vendor allows users to see all details of their accounts through the same interface, except it connects data to a crypto exchange, wallet, or protocol instead of to bank or brokerage accounts.

As users transact in their cryptocurrency accounts, Zabo will automatically update balances and other statistics in real-time.

On the B2B side, financial advisors and wealth management firms are adopting Zabo through its white-labeled cryptocurrency solution. Dubbed ‘Portfolio,’ it enables money managers to track and incorporate clients’ crypto assets into their traditional portfolios.

On top of that, having such a complete financial picture allows asset managers to better advise their customers and include crypto under their total assets under management for billing purposes.

A New On-ramp for Crypto Investors

Zabo didn’t share how much Coinbase will pay for the acquisition or what the integration into its platform will look like. However, the popular exchange said there is a mutual benefit to lining up Zabo’s team and technology, which made the takeover an easy decision for them.

Coinbase is convinced that to stand out from other crypto exchanges, one of its main goals should be to help users manage their crypto assets efficiently and effectively. Zabo’s service helps fulfill this mission as it unifies users’ disparate and overlapping investments, providing detailed balance and transaction histories.

Harmonizing a fragmented but evolving landscape of cryptocurrency would provide Coinbase customers with a more holistic picture of their activities and helps inform trading decisions. By contrast, most crypto trading exchanges only offer insights into accounts held with their respective platforms.

On the professional side of things, Zabo will help Coinbase onboard more institutional and deep-pocket players, particularly those seeking crypto investments to be reflected in their portfolios.

Advantages of Using Zabo

There are a number of additional advantages to using Zabo.

Excellent Coverage

Zabo is known for its breadth of coverage when it comes to types of crypto accounts. The cryptocurrency data aggregator claims to deliver data from 65+ exchanges and wallets while dozens of additional integrations are underway.

Additionally, Zabo supports not only custodial exchanges like Coinbase, Binance, Gemini, Kraken, and many more but also self-custody wallets held by users. This is critically important as it reduces impending security challenges.

Capabilities Beyond Crypto

Zabo has inked partnership deals with many portfolio trackers to extend their coverage beyond traditional financial data aggregation. At one point in the future, Zabo’s expanding partner network would enable users to track their cryptocurrencies alongside their bank accounts, brokerages, and stocks.

This is fundamentally important for a mega exchange like Coinbase, which has 56 million verified users trading $100 billion worth of cryptocurrency a month, as well as $223 billion in assets under custody.

These solid metrics make moving in this direction inevitable since it makes the investment cycle more convenient all around. The overall positive interaction should bring even more users into the ecosystem. It’s a win-win for all.

For the broader crypto community, Zabo has many rewards to offer.

Here’s What You Can Expect

  • Trading on an exchange aggregator platform like Zabo allows investors to avoid wading through multiple sign-up and log-in procedures across multiple exchanges.
  • Zabo has a rich visual interface that offers users an integrated and simplified experience and enables price comparison across different venues.
  • By partnering with multiple cryptocurrency exchanges, Zabo makes its collective investment products available to its user base. This simply increases the investment alternatives of underlying coins and derivatives, letting users reap the maximum benefits from a wide assortment of digital assets.
  • Zabo enables users to personalize their trading experience. For instance, you can configure real-time alerts for assets of your high interest and receive updates immediately delivered in your inbox or mobile.
  • Finally, the current regulatory environment has become more stringent. Zabo technically functions as an exchange aggregator, not bound by a certain jurisdiction; hence it is more or less immune to the constant fluctuation of regulations.

Conclusion

Luckily, Zabo fills a void in cryptocurrency capital markets since it supports all the top exchanges, giving users more control of their data.

Regardless of how this would fit within Coinbase’s broader ecosystem, such an acquisition will let the exchange launch more value-added products to stay ahead of peers trying to challenge its pole position in the market.

Meanwhile, it’s equally unclear how the acquisition will impact Zabo’s service offering longer term. However, it’s certainly true that the backing of a crypto heavyweight like Coinbase will bring many benefits to the entire industry.

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