The Big Announcement | Google Cloud & Coinbase Kicked Off A Collab

On 11th October 2022, Google announced that it would start allowing some customers to use digital currencies to pay for cloud services starting early next year upon announcing its collaboration with Coinbase – the largest cryptocurrency exchange in the United States. Coinbase will move some of its applications to the Google Cloud platform as part of the partnership.

The deal was announced at Google's Cloud Next conference, a move that analysts say could attract some “cutting-edge companies” to Google's cloud services. Currently, none of Google's major cloud service competitors allows customers to pay with digital cryptocurrencies, thus making it the pioneer in taking this bold step.

For Google's parent company, Alphabet, cloud services have allowed it to diversify its revenue, thus eliminating its heavy reliance on advertising. The cloud business currently accounts for 9 per cent of Alphabet's total revenue, up from less than 6 per cent three years ago.

By contrast, most of Coinbase's revenue comes from retail transactions. Jim Migdal, Coinbase's vice president of business development, asserted that as part of the partnership, Coinbase would move its data-related applications from Amazon Web Services (AWS), Amazon's cloud service, to Google Cloud services.

Amit Zavery, vice president of Google's cloud business, said in a media interview that by integrating the “Coinbase Commerce” service, Google Cloud Platform would initially accept digital cryptocurrency payments from a small number of customers in the Web3 world. Over time, Google will allow more customers to pay with cryptocurrencies.

The Coinbase Commerce service has won the support of a large number of merchants, allowing them to accept digital cryptocurrency payments more efficiently. Currently, Coinbase Commerce supports ten digital cryptocurrencies, including Bitcoin, Ethereum, and Litecoin.

The parties did not disclose the financial terms of the deal, and Migdal said that Coinbase would earn a percentage of commissions from transactions made through it.

In addition, Google announced that it is exploring ways to use Coinbase Prime, a service for storing and trading digital cryptocurrencies. Zavery said that moving forward, Google will be experimenting to see how they can participate in the management of digital assets.