Bitcoin's value has dropped drastically this year, but the value of cryptocurrency exchange Coinbase is skyrocketing in the opposite direction.
The San Francisco-based company on Tuesday announced a $300 million fundraising round that puts Coinbase's new valuation at $8 billion and makes it one of the most highly valued in the United States. The deal marks a massive increase from its previous valuation, which had been $1.6 billion as of August 2017.
The Series E round was led by Tiger Global Management, with participants including Andreessen Horowitz, Y Combinator Continuity, Wellington Management and Polychain.
Coinbase plans to use the funds to "accelerate the adoption of cryptocurrencies and digital assets," Coinbase President and Chief Operating Officer Asiff Hirji said in a statement.
The company, the best known U.S. cryptocurrency trading platform, is seen as a poster child for the fledgling industry. Its allure among top venture capitalists has been touted as a positive sign for the future of cryptocurrencies.
Coinbase, which landed at the No. 10 spot on the 2018 CNBC Disruptor 50 list, was certainly in the right place at the right time when bitcoin skyrocketed more than 1,300 percent last year to nearly $20,000.
Bitcoin and other cryptocurrencies have lost more than 65 percent of their value since, as retail interest wanes. But Coinbase has plowed money back into a master plan to cater to institutional investors. This year, it launched a suite of offerings for professional investors. One of them, Coinbase Custody, received regulatory approval last week from the New York Department of Financial Services.
It recently partnered with fellow cryptocurrency unicorn Circle to support a U.S. dollar-backed cryptocurrency known as a "stable coin." Coinbase said Tuesday it's focused on bridging the gap between fiat money and cryptocurrencies throughout regulated markets and building out its custody offering "to bring more institutional funds into the space."
The new equity should help Coinbase achieve that, while adding new assets to its popular trading platform.
"We see hundreds of cryptocurrencies that could be added to our platform today and we will lay the groundwork to support thousands in the future," Hirji said.
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