Why Coinbase, Ripple & Other Crypto Startups May Be Losing Their Charm

Coinbase founder and CEO Brian Armstrong

Coinbase founder and CEO Brian Armstrong attends Consensus 2019 at the Hilton Midtown on May 15, 2019 in New York City. Steven Ferdman/Getty Images

Less than two years ago, when Bitcoin was at its peak near $20,000, every startup that was blazing the trail in the crypto ecosystem was celebrated as the darling of Silicon Valley. To some companies, that momentum even carried on into 2018, despite Bitcoin’s collapse, as trading platforms continued making money and the buzz around blockchain technology kept rising.

San Francisco-based crypto exchange Coinbase, for example, raised $300 million in fresh capital last fall (when Bitcoin fell to $6,000), which made its co-founder and CEO Brian Armstrong a billionaire, and was ranked by professional networking site LinkedIn as the third best U.S. startup to work for.

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However, after another year of contemplation on Bitcoin and blockchain, it seems as if the world is losing interest in Coinbase and its many crypto peers.

On LinkedIn’s latest ranking of the 50 hottest U.S. startups to work for, Coinbase has dropped from last year’s No. 3 to a humble No. 29.

LinkedIn said its rankings are based on an analysis of billions of data points reflecting a company’s growth potential and the level of interest shown by job seekers, as well as the company’s current employees.

Blockchain payment startup Ripple, the company behind popular digital token XRP, has also slipped from last year’s No. 7 to No. 28 this year.

Other crypto companies in the top 50 last year, including Winklevoss twins’ Gemini crypto exchange (No. 25) and Ethereum co-founder Joseph Lubin’s ConsenSys (No. 26), have dropped off the list entirely this year.

Coinbase recently lost a crucial relationship with the traditional financial world when British bank Barclays ended its partnership with the San Francisco company last month. Until then, Barclays had acted as a middle man in connecting Coinbase to the UK Faster Payments Scheme (FPS), allowing users to withdraw and deposit British pounds on the crypto exchange.

Since then, Coinbase has found a replacement with UK banking startup ClearBank. The impact of this series of events on Coinbase’s valuation—as well as Armstrong’s net worth—is hard to quantify until the company’s next round of fundraising.

Why Coinbase, Ripple & Other Crypto Startups May Be Losing Their Charm