After Coinbase, a top US-based cryptocurrency exchange, announced coins that could potentially get listed on the platform, one of these cryptocurrencies gained more than 60 percent in a day.
The previously mentioned crypto coin, Matic Network (MATIC), jumped from 1 United States Cent to almost USD 0.017. The daily volume of the coin currently is above USD 133 million. This price rise was a rather big deal and it could be seen as a great opportunity to sell the coin.
Matic Network is a scaling solution that employs sidechains for scaling as well as utilizes the Plasma network for security. The system is decentralized and uses the proof of stake algorithm. It is also a platform for decentralized applications (dApps) and, at time of writing, sports two dApps.
Other coins that gained the attention of Coinbase are Dash, Algorand and Decret. None of these cryptocurrency have experienced major gains after the announcement. In fact, both Algorand and Dash have lost in value.
The sudden price gain of Matic is an example of what is called the Coinbase effect. Last year, after the platform announced that they were adding XRP, the price rose to almost 50 cents only to decrease rapidly.
Even though it is not clear when Coinbase has effect of the crypto price, many users and analysts claim that it usually happens when it is the first large exchange to accept that certain coin.