What Coinbases Media Play Means for Crypto?

Coinbase's apparent move into media is part of a trend of crypto companies developing their own content. Is this a good thing for the industry？

In case crypto media wasnt fraught enough, Coinbase is now apparently launching a media arm.

The U.S.-based exchange is looking for a top editor, who would report to the companys marketing department, Axios reported Tuesday. Coinbase said in an email that it has nothing to share at this time, but a job posting for a content director suggests that the exchange is branching out into media.

This may just be the beginning. Exchanges like Kraken already have content operations, and the top-tier venture capital firm Andreessen Horowitz (a Coinbase investor) is also getting into the media game. As more new investors rush into the market, there will be greater demand for crypto content. Exchanges can use media arms to raise brand awareness, attract users and just spark wider interest in crypto, which could ultimately be good for business.

But at what cost to the crypto industry？

Okay, let‘s get a few things out of the way. And, yes, CoinDesk is owned by Digital Currency Group, or DCG, a for-profit company with deep-pocket investments throughout the industry. CoinDesk maintains a policy of editorial independence. Still, the perception of interference creates its fair share of drama, such as when DCG’s Barry Silbert announced that DCG was shorting dogecoin (DOGE, +1.69%) and people wondered if that would shape CoinDesk‘s dogecoin coverage. For what it’s worth, Coinbase is also a DCG portfolio company, and this piece isn‘t exactly advancing either company’s interests.

Newcomers need objective information.

Crypto has entered the mainstream. It‘s on “Saturday Night Live.” It’s on “Ellen.” It‘s on Elon Musk’s Twitter feed, basically all of the time. Paris Hilton makes non-fungible tokens, and Tom Brady is launching an NFT company. Slim Jim, social medias favorite meat stick, has a crypto strategy.

Take dogecoin, a wildly popular coin with no shortage of risks. Will exchanges media operations be incentivized to highlight the flaws of specific tokens, particularly when the platforms may be listing those tokens themselves？

The line between content and marketing will get blurrier.

The problem is that as more exchanges enter the media world, competition for eyes will get fiercer. And people won‘t want to read ads; they will look for engaging content. Exchanges ultimately want to attract new users. To do that, they have to get people’s attention, which will require increasingly sophisticated content that doesnt resemble marketing at all. Imagine, for example, a piece that reads like an objective article but features examples that have been cherry-picked to create a positive impression of a particular crypto project. These incentives may not be immediately obvious to the reader, many of whom will not be that skeptical to begin with. Maybe this trend would lead readers to seek out more independent sources of information, but it could also end up eroding trust in the media as a whole.

How that will play out in reality remains to be seen. The danger is a surge of “another sunny day in crypto” stories, which are not ideal for an industry that is already rife with risk.