Coinbase, leading US digital currency marketplace, hires Twitter exec who oversaw user services

Key Points
  • Coinbase announces Monday that Tina Bhatnagar, former vice president of operations and user services at Twitter, is becoming vice president of operations and technology at Coinbase.
  • Bhatnagar plans to double the size of the support team and give all customers 24/7 telephone support by the second quarter of this year.
  • The news is Coinbase's latest high-profile executive hire, and comes as at least one other digital currency exchange ramps up its team.
Brian Armstrong, co-founder and chief executive officer of Coinbase Inc.
David Paul Morris | Bloomberg | Getty Images

As leading U.S. digital currency marketplace Coinbase struggles to handle accelerating consumer demand, the start-up has hired an executive from Twitter to improve customer support.

Tina Bhatnagar, former vice president of operations and user services at Twitter, is joining the company, Coinbase co-founder and CEO Brian Armstrong announced Monday. Bhatnagar will be vice president of operations and technology at Coinbase, with the goal of doubling the size of the support team so that all customers will have 24/7 telephone support by the second quarter of this year.

"It's a rare opportunity to be able to go into a hypergrowth company and make an impact," Bhatnagar said in a phone interview with CNBC.

San Francisco-based Coinbase has struggled to keep up with the surge of interest in digital currencies such as bitcoin, which has soared more than 1,100 percent over the last 12 months. Its website has suffered degraded performance due to occasional spikes of high traffic, while trading services have suddenly gone down for hours. Money transfers from PayPal have been unavailable since Friday, according to Coinbase's status website.

The company, valued at $1.6 billion, grew from less than 5 million users in late 2016 to more than 13 million at the end of November. Twitter had an average 330 million monthly active users as of the third quarter of 2017, up from 317 million a year ago.

Overall, Coinbase doubled in size in 2017 and had about 200 employees by the end of last year, according to the company. Its GDAX exchange also plans to launch an office in Manhattan later this year.

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Bhatnagar is the latest in a handful of high-profile hires Coinbase has made in the last several weeks.

On Dec. 1, Coinbase announced that Asiff Hirji, former president and chief operating officer at online broker TD Ameritrade, would assume those roles at the digital currency marketplace. Hirji was previously an advisor at Andreessen Horowitz, an investor in Coinbase.

Then in mid-December, Coinbase announced that David Marcus, head of messenger at Facebook and former president PayPal, would be joining the digital currency company's board of directors.

In the near future, "I think you'll see some other senior hires," Dan Romero, Coinbase general manager, told CNBC in a phone interview. "We're an early company in the space. We've [had] great growth in 2017. That is something we can lose."

While Coinbase is among the largest digital currency marketplaces in the U.S., other digital currency exchanges are also growing rapidly.

Bill Shihara, CEO of digital currency exchange Bittrex, told CNBC on Friday that the company is adding more than 100,000 new users a day and had 3.8 million users at the end of December. Trading volume has surged from $12 million a day in March to an average of $3 billion.

Bittrex has about 5 percent of U.S. dollar-bitcoin trading volume, according to CryptoCompare, while Coinbase's GDAX exchange has about 12 percent.

The smaller exchange is also adding new executives to a team that has multiplied rapidly in size from just four people in April 2017. In mid-December, Bittrex hired a former senior official from the departments of Justice and Homeland Security, as well as the former inspector general of the Department of Homeland Security.

"Growth is going to continue to come from hiring the best and brightest people," Shihara said. "Our phones are ringing off the hooks from people wanting to get into the space."