How Much Bitcoin Will Coinbase Buy?

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“We have committed to invest $500 million of our cash and cash equivalents into a diverse portfolio of crypto assets. Going forward, we will also allocate 10% of quarterly net income into this same portfolio.” – The Coinbase Blog

In a tweet from Coinbase CEO Brian Armstrong on Thursday night, it was announced that Coinbase was going to be purchasing $500 million in a “diverse portfolio of crypto assets,” and an interesting note is that the portfolio allocation will be decided based on the custodial balances of the assets held on Coinbase by its consumers.

“Our crypto asset investment allocation will be driven by our aggregate custodial crypto balances — meaning our customers will drive our investment strategy. Our investments will be continually deployed over a multi-year window using a dollar-cost averaging strategy.”

Digging deeper, we can make some estimates on the size of the bitcoin allocation that will be made by Coinbase using exchange balances and the numbers reported in the company’s recent Q2 earnings report.