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Coinbase’s Strategic Move to African Markets Coinbase’s Strategic Move to African Markets

Coinbase Global COIN ventures into Africa.

Expansion into Africa: Coinbase has formed a collaboration with the African stablecoin exchange Yellow Card to broaden its product offering in developing economies.

The company is targeting 20 countries across Africa from February 2024.

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Through this partnership, over 50% of the African population will be able to purchase USDC through the Coinbase wallet app.

Users can transmit stablecoins via email and messaging platforms like WhatsApp, iMessage, and Telegram without incurring fees. Coinbase’s Layer-2 blockchain Base can be utilized to acquire USDC for cost-effective transactions.

The move is part of Coinbase’s “Go Broad, Go Deep” Strategy for international expansion. Africa’s substantial young population is poised to reap the benefits of cryptocurrency. Reports indicate that over 70% of crypto owners globally are under the age of 34.

Yellow Card secured $1.5 million in August 2020 in a seed round, along with $15 million in a Series A round in 2021, and $40 million in a Series B round in September 2022.

Significance of the Move: Following the approval of the historic Spot Bitcoin ETF, market sentiment has been positive. A Wedbush report upheld its outperformance rating on Coinbase and elevated the stock’s price target to $180 from $110, citing the company’s pivotal role in these ETFs.

Mizuho Securities views the approval as a “pyrrhic victory for COIN.”

Last week, Coinbase disclosed its plans to acquire a MiFID-licensed entity to expand its derivatives offering in the European Union. The deal is expected to conclude in 2024 after regulatory clearance.

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