Memecoins
This Coinbase Catalyst Could Send Solana Meme Coins Skyward
This new development will open the doors for casual crypto investors.
Global Coinbase (PIECE OF MONEY -2.45%) is the cornerstone of the cryptocurrency ecosystem, providing investors with easy access to convert their dollars into a plethora of different tokens. Although it is not the only company providing these services, it is clear that with such a privileged position, its offerings tend to have a big impact on cryptocurrencies, including the most popular ones like Solana (GROUND -0.19%).
Coinbase recently launched a new service that will likely catalyze the growth of Solana, as well as the many meme coins on-chain. Here’s what’s happening and how you can position yourself to take advantage of it.
Crypto infrastructure matters
Getting started with investing in cryptocurrencies for the first time is difficult. A large part of the blockchain the technology itself is clunkier than typical consumer software applications. Plus, the space has so much technical jargon to learn, so many slang terms to know, and a reputation for scams and risk that is enough to keep many people away.
Coinbase is working to address some of these issues by launching a new, highly streamlined platform for users to hold and use their coins.
The new “smart” Coinbase wallet is compatible with Bitcoin, Ethereum, and Solana, as well as all ERC-20 channels. It can interface with decentralized applications (dApps) and decentralized exchanges (DEX), store non-fungible tokens (NFTs), connect to a user’s bank account, and freely transact with a user’s Coinbase account. user. Everything people could do with a self-directed wallet, including staking tokens in a liquidity pool, swapping token pairs, and borrowing or lending crypto, is doable with the new wallet.
Coinbase hopes its innovation will bring up to 1 billion people into the crypto markets because of how easy investing in the space will become compared to what it is currently. It’s unclear whether the company will be able to onboard all the users it hopes. But if it manages to attract even a fraction of the population it hopes for, the implications for cryptocurrency markets, particularly Solana, will likely be gargantuan.
Currently, on the Coinbase website, users are limited to trading in cryptocurrencies that the company selects as suitable, which tend to be the most reputable currencies. It means the biggest coinsas Shiba Inu And Dogecoinare tradable, but future coins are often not available until long after an investor prefers to begin a position.
With the new wallet, there is still the constraint of being able to transact only with coins Coinbase has chosen to list, and it may still take a long time for the company to list promising new issues. But because the wallet allows transactions to be carried out via decentralized exchanges (DEX), the company does not need to hold the tokens itself, so the accessible universe of investment projects is much larger . So, investors will now have the opportunity to invest in coins much earlier than before and will generally be able to invest in much smaller coins if they choose to do so.
For Solana Chain coins, where most of the smaller and riskier meme coins reside, the new wallet could generate significant growth across the board. If Coinbase chooses to list projects more loosely than it currently does for users of its wallet, which will be necessary if it intends to defend the claim that its wallet allows people to retain custody and ownership. complete control of their cryptocurrency holdings, the impact will be even greater. bigger.
Regardless, this is a big green flag for Solana and coin investors.
You don’t need to take risks to enjoy some of the future growth.
There’s no need to start investing in meme coins yourself to take advantage of the influx of capital spurred by Coinbase’s new wallet. There is also no need to download the wallet yourself if you already have a setup that works for you. The safest way to gain exposure to the anticipated upside is to simply buy Solana and hold it for the long term, as anyone trading coins on-chain will need to purchase its native. token First of all.
If you want to get a little more sophisticated by tackling coins as well, do yourself a favor and stick to proven winners rather than supposedly emerging contenders. The reigning champions will always be very risky and volatile.
But they will also be the entry point that most new cryptocurrency investors will have to invest in coins due to their size and proven effectiveness in attracting a share of attention over time. And, at least in the case of Shiba Inu and Dogecoin, they have enough history that it is very unlikely that their prices will collapse all the way to zero.
Above all, don’t take risks with money you can’t afford to lose. Play the long game and play it carefully. If you haven’t done it yet diversified your portfolio enough, the best decision is to do this before approaching the idea of buying Solana coins or even, as responsible financial management of your portfolio is a greater priority.
Alex Carchidi has positions in Bitcoin, Ethereum, Shiba Inu and Solana. The Motley Fool holds positions and recommends Bitcoin, Coinbase Global, Ethereum, and Solana. The Mad Motley has a disclosure policy.