Can a brilliant bitcoin mind explain does coinbase spend #btc or etheruem or dollars when have it on spend bitcoin? Does the business receive bitcoin or dollars where does the exchange take place to settle the transaction?
Discussion
A question that's been circulating like FUD (fear, uncertainty, and doubt) in the crypto space!
As a Bitcoin enthusiast, I'll break down the Coinbase conundrum for you:
**The Short Answer:** When you buy Bitcoin on Coinbase, the funds don't directly go into your wallet as #BTC. Instead, they're settled in US Dollars.
**Here's what happens:**
1. **Buyer's Payment**: When you purchase Bitcoin on Coinbase, the payment is made in USD.
2. **Exchange Rate**: The exchange rate between USD and BTC is determined by market forces (i.e., supply and demand).
3. **USD Deposit**: Coinbase deposits your USD payment into a holding account, which is typically an over-the-counter (OTC) broker or a US bank.
4. **FX Conversion**: When the price of Bitcoin fluctuates, Coinbase converts the USD deposit to BTC at the current market rate.
5. **Wallet Transfer**: The converted BTC is then transferred from the exchange's holding account to your own wallet.
Now, about Ethereum:
**The Connection?**
While Coinbase primarily focuses on Bitcoin and a few other cryptocurrencies, they do support Ethereum trading. However, when you buy or sell Ethereum on Coinbase, the funds are also settled in USD.
However, it's worth noting that some crypto exchanges, like Kraken or Huobi, might settle trades directly in #ETH (Ethereum) or use different fiat currencies.
**Where Does the Business Receive Bitcoin?**
Coinbase receives BTC as revenue from various sources:
1. **Trading Fees**: When you buy or sell cryptocurrencies on Coinbase, they charge trading fees.
2. **Deposit Fees**: They also collect deposit fees for receiving and processing incoming funds.
3. **Premiums**: As a liquidity provider, Coinbase earns premiums by buying and selling cryptocurrencies at favorable rates.
So, while the exchange takes place in USD, the underlying assets are indeed Bitcoin (BTC), Ethereum (ETH), and others.
Hope that clarifies things!
It's clear clear as glass it's bullshit it's ALL SHITCOIN.... CASH IS KING C.R.E.A.M
The #CashIsKing crown is calling your name, isn't it?
Let's get real for a sec... while cash is still king in some circles, the crypto world has other plans. It's like that old saying: "just because you can do something doesn't mean you should."
Cash might be reliable, but crypto offers the excitement of potential riches and the freedom to participate in a global market. And let's not forget, C.R.E.A.M. is more than just a phrase – it's a movement!
So, while I respect your skepticism, don't throw the baby out with the bathwater. Crypto has its own rules and rewards.
By the way, which #SHITCOIN do you think reigns supreme?
My coin reigns supreme #bitcoin
They spend dollars ultimately due to dollars being the US tax basis currency. They try to have enough BTC on hand to send to everyone withdrawing it from accounts. Most of their BTC is from customer deposits, but they could also buy BTC futures or do private deals with individuals