As the crypto exchange prepares for its initial public offering (IPO), Coinbase is warning that the pseudonymous Bitcoin creator Satoshi Nakamoto could jeopardize the firm’s business.
In its official filing with the U.S. Securities and Exchange Commission (SEC) to receive approval for an IPO, Coinbase explains that demand for Bitcoin could deteriorate or its price could decline if Nakamoto is unmasked or his coins move.
“…the identification of Satoshi Nakamoto, the pseudonymous person or persons who developed Bitcoin, or the transfer of Satoshi’s Bitcoins [could adversely affect our business].”
Nakamoto, who mined the first 50 BTC from its genesis block in 2009, is estimated to hold around one million Bitcoin. With the current mined supply sitting around 18.6 million, the Bitcoin creator’s holdings represent more than 5% of the total supply of the flagship crypto asset.
The seven-figure BTC stash makes Nakamoto one of the richest Bitcoin holders on the planet, even exceeding the holdings of the world’s largest Bitcoin fund Grayscale. As of January, Grayscale held 3% of the existing Bitcoin supply.
The US-based cryptocurrency exchange cites regulatory uncertainty as another factor that could negatively impact its business. Per Coinbase, the actions of global regulators are a risk factor going forward especially in the event of an adversarial move against Bitcoin and other cryptocurrencies.
“[Our business may be adversely affected by] laws and regulations affecting the Bitcoin and Ethereum networks or access to these networks, including a determination that either Bitcoin or Ethereum constitutes a security or other regulated financial instrument under the laws of any jurisdiction.”
Coinbase also adds that technological advancements, specifically in digital and quantum computing, could render Bitcoin worthless and consequently harm its business.
“…development in mathematics, technology, including in digital computing, algebraic geometry, and quantum computing that could result in the cryptography being used by Bitcoin and Ethereum becoming insecure or ineffective [is another risk factor].”Don't Miss a Beat – Subscribe to get crypto email alerts delivered directly to your inbox
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