Coinbase acquisition echoes the heyday of ICOs

By Muyao Shen, Bloomberg

Translated by Saoirse, Foresight News

Coinbase Global has acquired digital asset investment platform Echo for $375 million, reviving memories not so distant—the boom period of less than a decade ago when thousands of cryptocurrency projects raised billions of dollars by directly selling tokens to investors.

Initial coin offerings (ICOs) fueled cycles of boom and bust in the crypto market and introduced cryptocurrencies to a broad investor base. In 2018, the speculative bubble burst quickly as regulators cracked down on rampant fraud, bringing token sales to a halt. Market participants now see Coinbase's acquisition as a sign that the old is returning in a new form.

The shift in market dynamics began last year: Echo, founded by crypto trader and influencer Jordan Fish—better known by his pseudonym Cobie—started raising private funds for cryptocurrency projects. Earlier this year, Echo launched Sonar, a tool supporting ICO-style fundraising. According to Coinbase, Echo has facilitated around $200 million in funding for crypto projects through more than 300 transactions.

Shuyao Kong, co-founder of blockchain project Megaeth, said: "ICOs have quietly returned, but until now they've mostly remained within crypto's inner circles. Coinbase's acquisition of Echo changes that—it brings the ICO mechanism to a regulated, global audience." His project raised $10 million through Echo in just three minutes last year.

Christopher Perkins, president and managing partner at New York-based venture fund CoinFund, noted the acquisition also signals clear market demand for "a fair, transparent, efficient, and competitive process for asset listings."

The current wave of optimism in the industry is closely tied to signals from a second Trump administration: regulators are crafting the U.S.'s first comprehensive legal framework for crypto while saying they don't intend to stifle what they define as "innovation."

Sandeep Nailwal, co-founder of Polygon, said: "Since President Trump took office and regulatory constraints on crypto were lifted, ICOs have become one of the first innovations to rapidly gain traction in the industry. It’s highly valuable because it ensures retail investors—not just a select few privileged ones—can access high-quality projects on day one."

On Monday, Coinbase CEO Brian Armstrong announced a teaser to pave the way for the acquisition: the U.S.'s largest crypto exchange will revive Cobie’s popular crypto podcast, *Up Only*. Coinbase paid $25 million for an NFT representing the rights to relaunch the podcast, which had been inactive since 2022. Similar to exercising an option, Cobie must produce eight new episodes to activate the NFT.

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Industry participants believe the most significant implication of the acquisition is boosting Coinbase's competitiveness against Binance—the current leader as the world's largest cryptocurrency exchange. Binance already operates multiple platforms, including Binance Launchpad, that help early-stage crypto projects achieve liquidity for their tokens.

Santiago Roel Santos, founder and CEO of crypto private equity firm Inversion, said: "Acquiring Echo makes Coinbase's services more appealing to retail users—through Sonar, users can participate in private and public token sales. How Coinbase integrates Echo, especially Sonar, to enable greater retail participation in early-stage investments and token projects will be worth watching."

What remains unknown is whether another ICO boom will once again be followed by a crash.