Crypto exchange platform Coinbase is expanding its product offering to gain recurring revenue and grow its customer base with its own financial services platform. 

 The “onchain” platform will offer similar financial services to those provided by banks, a Coinbase spokesperson told Bank Automation News. 

“In addition to being established as a trusted place to buy and sell bitcoin, we are increasingly working to become a platform for powerful onchain financial services that will help people use and grow their money,” the spokesperson said. 

An onchain financial services platform is built on blockchain and can help customers conduct banking activities on a blockchain network, according to global payments company TransFi. Onchain platforms can help make payments, verify identity, lend and maintain compliance faster than traditional payments services without needing a banking license, according to the Tampa, Fla.-based company. 

San Francisco-based Coinbase is investing heavily in building the onchain platform, Chief Executive Brian Armstrong said during the company’s first-quarter earnings call on May 8. Money market funds, real estate payments, securities, debt and other asset classes are slowly pivoting toward an onchain financial infrastructure, he said. 

“We really want to stay where the puck is going and be the best company at building onchain [infrastructure],” Armstrong said. 

Expanding product offerings, push for annual recurring revenue 

In addition to its onchain build-out, the company is launching a credit card with American Express, Coinbase announced June 12. 

Fintechs are moving toward an annual recurring revenue business model as investors prefer steady growth and profitability over seasonal growth, Saumil Misra, senior analyst at think tank Everest Group, told BAN. Such offerings will allow fintechs to compete directly with banks without jumping through regulatory hoops. 

The Coinbase credit card will charge a $49.99 annual fee and provide 4% cashback in bitcoin with each purchase, according to Coinbase. 

The company also has a debit card in partnership with Visa.