Published - October 12, 2022 @ 12:15 PM (EET)

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In a joint statement Tuesday, Alphabet Inc.'s Google (NASDAQ:GOOGL) entered into a strategic partnership with Coinbase (NASDAQ:COIN) that will allow select customers to pay for cloud services with cryptocurrencies through Coinbase's payment platforms.

Announced at Google's Cloud Next Conference, the tech giant will start accepting crypto payments for cloud services early next year.  

Though shares of Coinbase climbed 4.3% following the news, the stock is still down roughly 72% this year amid a global downturn that particularly hit digital assets.

WHY IT MATTERS

The first-of-its-kind move will assist in attracting innovative firms to Google in a competitive, fast-paced market, topping rivals in the cloud market that do not currently allow customers to pay with digital currencies.

As part of the agreement, Coinbase will use Google Cloud's compute platform to process blockchain data at scale and build its global data on Google Cloud's infrastructure.

According to a Coinbase spokesperson, some data-related applications of the largest US crypto exchange will move to Google from the Amazon Web Services cloud.

Initially, crypto payments will be available only to a handful of customers involved in the Web3 industry.  Google will also use Coinbase Prime for institutional crypto services.

CEO of Google Cloud, Thomas Kurian, said, 

‍"We want to make building in Web3 faster and easier, and this partnership with Coinbase helps developers get one step closer to that goal."

NOW WHAT

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The partnership helps Alphabet's Google move away from advertising.  Its Google Cloud Services now account for 9% of overall revenue, compared to less than 6% three years ago.

Apart from this, the crypto partnership comes with Google announcing a broad swath of updates to its cloud offerings, aiming to capitalize on its strength in artificial intelligence to gain market share from rivals.

While Google is trailing rivals Amazon.com Inc. (NASDAQ:AMZN) and Microsoft Corp. (NASDAQ:MSFT) in the cloud space, the latest efforts are considered Google's best bets for growth.