Technology 3 min read

Coinbase and SoFi to Launch Cryptocurrency Partnership

MichaelWuensch / Pixabay

MichaelWuensch / Pixabay

Based in San Francisco, SoFi functions as an online finance startup. Their move into cryptocurrency comes as a bit of a surprise. But their CEO says that their target audience prompted the partnership with Coinbase.

“Our target audience wants to see what the price of cryptocurrency is and to buy it,Anthony Noto said about the deal. You might recognize Noto’s name since he is the former chief operating officer at Twitter AND a former Goldman Sachs managing director.

How does this fit in with the company’s status as a lending startup?

How a Lending Company Incorporates Cryptocurrency

As mentioned, SoFi normally functions as a lending company. They provide mortgages, student loan refinancing, and personal loans to clients. The company uses a non-traditional underwriting avenue centered around lending to “financially responsible individuals”.

SoFi determines this status by examining professional history, cash flow and liquidity, and education along with bill payment history.

According to Noto, the partnership with Coinbase serves client wishes and the goal of the company.

“We put the member at the center of what we are doing and what they want to do to achieve their financial independence.”

Though we don’t know which currencies will be offered yet, the two companies have worked together before in a similar capacity of facilitating trading. But SoFi is not the first to partner with Coinbase in this way as Fidelity also has a similar arrangement.

However, SoFi will be unique in that they allow clients to buy and sell digital coins.

Supporting Client Demands with SoFi Invest

SoFi Invest allows clients to trade cryptocurrency, but it joins another aspect, too.

SoFi Money launched alongside the new venture and allows a 2.25 percent APY cash account. It does this with no fees, as well, as many firms in this field want to win customer deposits.

Initial exchange-traded fund filings suggest that Vanguard and BlackRock’s iShares will be initial “targets”.

While the company plans to relaunch its home loan product on March 1st, this new venture will tide clients over with “active” investing and “robo” advising. SoFi will also release “saving vaults”, joint accounts, a credit card offering, and roundups later this year.

As for an IPO in 2019, Noto clearly stated that it isn’t a priority this year.

Last valued at around $4.4-billion USD, it will be interesting to see how this Coinbase partnership alters the trajectory of this FinTech startup.

Read More: Chinese Tech Companies Take Down Cryptocurrency Sites Amid Country’s Crypto Crackdown

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Juliet Childers

Content Specialist and EDGY OG with a (mostly) healthy obsession with video games. She covers Industry buzz including VR/AR, content marketing, cybersecurity, AI, and many more.

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