[ad_1]
While Coinbase – one of the biggest names in blockchain – is certainly benefiting from the resurgence of cryptocurrencies in 2020, the company has undergone a number of unexpected challenges in recent months. From public perception to system outages, the following are some drawbacks the industry leader has encountered.
Discrimination
The first issue in question is also the most recent. In an article published According to the New York Times, 23 former Coinbase employees shared their experience on the popular stock exchange – unfortunately for Coinbase, these experiences have been highlighted by alleged recurring cases of discrimination against the company’s black employees.
In this exhibit, past employees share stories that have seen them put on public display in an effort to cultivate a positive public image, but routinely treated with a disrespect behind closed doors.
It is no secret that such accusations can destroy a young company. As such, Coinbase took the initiative to anticipate this bad press by releasing a declaration by itself, prior to the publication of the New York Times.
It’s important to remember that these claims are just that: claims. While they may be true, Coinbase remains steadfast in its position that no error has occurred. Regardless of where the truth lay, there will undoubtedly be more control over the operations at Coinbase that will go ahead by both those outside and inside the company.
Political position
Before the New York Times exposure on discrimination on Coinbase, the company had made a bold move on politics.
In September 2020, Coinbase CEO Brian Armstrong announced that the company was taking an apolitical position and would offer employees uncomfortable with the decision the opportunity to step down while receiving a ‘generous exit package’. ‘.
This decision came as companies across North America expressed their support for the Black Lives Matter (BLM) movement.
Opinions are and will continue to be divided over the responsibility of companies to participate in social activism. Yes, Coinbase is in a position to use a voice that will reach masses of people. At the end of the day, however, it’s still just a company involved in FinTech – its mission has never been to address issues as big as the one at hand.
Brian Armstrong, CEO of Coinbase, recently commented on why it has not followed the lead of other companies that have decided to speak on BLM.
“The reason is that while I believe these efforts are well-intentioned, they have the potential to destroy a lot of value in most companies, both by being a distraction and by creating internal division.”
Despite its mission, the decision to remain apolitical may not be appropriate in 2020. According to Coinbase’s account, social activism has become commonplace in Silicon Valley. The company says its position was taken as a means of protecting the company’s value – a definite risk in a society that places greater emphasis on social activism.
System outages
Going beyond political and labor issues, Coinbase has also endured its fair share of tech problems along the way – they are a growing FinTech company after all.
What is surprising is that the recent technological problems brought to light are by no means new. Dating back to the 2017 bull market, the Coinbase exchange has a reputation for collapsing at inopportune times. It just can’t handle the workload in one moment and three years later that’s still a problem.
A recent example of this occurred on November 24, 2020. Right now, thousands of users have started reporting issues with the platform, amid a flurry of market activity.
Coinbase is one of the biggest names in the blockchain. Unfortunately, this means that when it can’t promote and maintain high levels of reliability, it paints a poor reflection of the entire industry. It appears that cryptocurrencies are still the “wild west”, an association that many are working to distance themselves from.
In order for blockchain to keep moving forward, the industry needs its biggest and best to be just that.
AirDrop support
While the above examples have already taken place, another potential drawback has yet to occur. In the near future, holders of the popular cryptocurrency Ripple or “XRP” will receive an airdrop, courtesy of a company called “Float”.
Smart contracts are a promising implementation of blockchain technology, supported by various projects such as Ethereum. Although XRP does not currently advertise the ability to host smart contracts, Float and its “ Spark tokens ” change it.
With XRP remaining one of the most popular cryptocurrencies in the world, the expectation for Spark tokens is surprisingly high. Unfortunately, XRP holders who keep their assets within Coinbase are expected not to benefit from this process. While Coinbase really has time to announce support for the move, it doesn’t have much.
If support is not announced, it would not be surprising to see a large amount of XRP withdrawn from Coinbase wallets and stored elsewhere, in a wallet that will guarantee holders to receive their airdrop.
While airdrops can place an undue burden on exchanges, customers expect them to be supported. Regardless, if Coinbase remains one of the few to avoid taking on this burden, it will be seen as the last hitch in a string of many.
Going forward
No company is perfect. Each will be presented with unique battles and will have to find the best way to move forward. Despite the problems Coinbase has experienced over the past year, the company remains at the forefront of the blockchain industry. Moving forward, it still represents one of the brightest spots in the industry as a reliable, reputable and promising platform.
Thankfully, the issues surrounding Coinbase don’t seem to have hindered product development. While addressing each of the aforementioned problems, Coinbase has continued to march forward, with a recent one example being the launch of its “Coinbase Card” in the United States.
