[tigger0jk]

I believe coinbase holds a lot of crypto - in the robinhood analogy, coinbase is their own clearing house. So they don't have to post collateral to themselves, but if crypto movement was all in one direction on a given day, they might rely on the market instead of the liquidity they themselves provide. Maybe in such a scenario they would be clever enough to NOT resolve all the trades instantly.

[rory]

Got it, so in general, they are _actually_ fronting you the asset (although you can't take it out of their control until you've paid up), as opposed to an IOU.

[throwaway192874]

Yeah, they already have the asset when you click buy. On "consumer", the blue one, when you click buy it literally does a direct market order off of Coinbase Pro to purchase the asset, and since it's on Pro they already have the crypto on platform.