Coinbase and the Bitcoin Treasury Problem: Playing it Safe Rather than Following Michael Saylor
On May 9, Coinbase CEO Brian Armstrong revealed that the company had repeatedly considered an “all-in” Bitcoin strategy for its treasury, but ultimately decided against it. The choice reflects a cautious move as businesses increasingly accumulate Bitcoin by 2025.
For more than a decade, Coinbase, the largest cryptocurrency exchange in the United States, has considered the idea of allocating up to 80% of its balance sheet to Bitcoin, similar to what MicroStrategy under Michael Saylor did. However, Armstrong said the company did not pursue it due to concerns about financial stability and potential risks to its core business, according to Bloomberg.
Coinbase Doesn’t Want to Be a “Speculative Player” Competing with Customers
Instead of converting its entire treasury into Bitcoin, Coinbase has taken a more balanced approach. The company currently holds around 9,480 BTC, worth approximately $988 million, making up the bulk of its $1.3 billion in total crypto assets. That makes Coinbase the ninth-largest Bitcoin holder in the world, according to data from TradingView.
Coinbase chief financial officer Alesia Haas said the company doesn’t want to position itself as competing with its own customers — traders and investors — on the price performance of Bitcoin. This is consistent with Coinbase’s role as a market infrastructure provider, not a crypto-speculative institution.
Saylor’s Strategy and Lessons for Businesses
MicroStrategy defined the modern Bitcoin treasury model when it began buying BTC in 2020. By May 2025, the company held more than 555,450 BTC (worth about $38 billion), using a variety of financial instruments such as convertible bonds, equity offerings, and common stock issuances to finance its accumulation.
This model has made MicroStrategy a poster child for “Bitcoinized” businesses, but it also comes with enormous risks due to price volatility. Meanwhile, Coinbase – which relies on trading – is forced to maintain capital stability and diversify its assets.
Rather than accumulate Bitcoin, Coinbase expands its corporate acquisition strategy
Not following an “extreme” Bitcoin strategy does not mean Coinbase rejects cryptocurrencies. In the first quarter of 2025, the company purchased an additional $153 million in cryptocurrencies, mostly Bitcoin. In addition, Coinbase recorded revenue of $2.03 billion, up 24.2% year-over-year, and profit of $527 million, or $1.94 per share, slightly below expectations.
Notably, Coinbase just made a $2.9 billion acquisition of derivatives platform Deribit, the largest deal in the history of the crypto industry. With Deribit handling more than $1 trillion in trading volume by 2024 and maintaining about $30 billion in open interest, the deal opens the door for Coinbase to dominate the derivatives market.
Bitcoin Treasuries – Opportunity or Pitfall?
Since the pandemic, inflation, interest rate volatility, and geopolitical risks have prompted many companies to reconsider how they allocate their treasuries. Fidelity Digital Assets sees Bitcoin as an alternative to traditional assets like Treasury bills and commercial paper.
However, the “Maximum Bitcoin” model is also controversial. In addition to high volatility, companies face compliance risks, complex accounting valuations, and difficulties in managing digital assets. The Trump administration has made strides in the cryptocurrency regulatory framework, giving CFOs more confidence in integrating Bitcoin onto their balance sheets.
New Models to Replace Saylor-Strategy
Firms like Strive Asset Management are developing a multi-layered Bitcoin treasury model that optimizes Bitcoin per share, rather than total BTC holdings. According to Bitcoin Magazine, the model combines tax incentives, balance sheet engineering, and capital market knowledge to maximize shareholder returns.
Conclusion
Coinbase’s decision not to go all-in on Bitcoin shows a level of sobriety and long-term thinking. While many businesses are jumping on the Bitcoin hoarding bandwagon as a means of wealth protection, Coinbase remains committed to its role as an infrastructure provider for the entire ecosystem – a less flashy strategy that may be more sustainable in the long run.