Retired Judge Favors Medical Marijuana in Kansas

By Michael Hooper

Kansas is moving slowly toward the creation of a medical marijuana program after examining programs in Missouri, Oklahoma and Colorado.

Rep. John Barker, a retired judge from Abilene, has been working on a bill that would create the Kansas Medical Marijuana Regulation Act and the Kansas Medical Marijuana Regulation Program.

                                         Rep. John Barker

For the very first time, a medical marijuana bill made it out of committee in the Legislature on March 29. The Kansas House Federal and State Affairs Committee approved the bill 13-8 sending it to the house for debate. That bill has been folded into House Sub for SB158 and was referred back to committee.

"This is the second year we have introduced this bill," said Barker, chairman of the Committee on Federal and State Affairs. "We had a hearing and we worked on the bill and then moved it to the floor of the House. The speaker sent it back to committee."

The committee's bill, modeled after the Ohio medical marijuana program, authorizes doctors to prescribe cannabis to patients suffering from one of 20 conditions, including AIDs, cancer, irritable bowel syndrome, chronic pain, multiple sclerosis and PTSD.

Barker described his committee members as very conservative people; debate on the bill in March was contentious. Law enforcement has come out against it, but some doctors support it. Advocates said it would provide much needed relief to Kansans suffering from various ailments, such as epilepsy or chronic pain.

Barker said he plans to work on the bill with committee members, and discuss possible amendments or changes.

"We will get through it," Barker said in an interview with the author on April 15, 2021.

The Legislature returns from spring break on May 3.

Barker anticipates the Committee on Federal and State Affairs would approve the medical marijuana bill and send it back to the House floor. He believes there is 70 votes in the House to approve it. If that happens, he said, the bill would either be dead at the Senate or go to a conference committee.

If the bill is approved by the Senate, Barker said Gov. Laura Kelly will sign it.

Thirty-six states have approved some form of medical cannabis legalization, but it is still illegal at the federal level, Barker said. He expects Congress to move cannabis from a Schedule 1 to Schedule III or IV for medicinal usage.

Barker said his committee looked at cannabis programs in Colorado, Oklahoma and Missouri. Missouri is full of lawsuits now because of the cap on the number of medical marijuana licenses. Barker favors no cap on licenses in Kansas.

Let the free market determine the number of medical marijuana distributors in Kansas, he said.

"I'm a conservative. I believe in the free market system," Barker said. "Some businesses will fail, some will succeed."

Barker said in Maryland, a medical cannabis license is more than $1 million and cannabis is very expensive. He said competition will make the cannabis market more competitive, so the average guy can get a month's prescription at a reasonable price. He described Oklahoma's medical marijuana program as the wild west.

"We want a more structured program in Kansas," Barker said.

House Sub for SB158 creates a medical board under the Kansas Health and Environment. Doctors would go through training to issue prescriptions of medical marijuana. Pharmacists would have a role in it, Barker said.

The state Alcohol Beverage Control (ABC) would be in charge of enforcing regulations in the cannabis bill.

Gov. Kelly had proposed a medical marijuana program that would generate tax revenue to support Medicaid expansion. But Kelly Rippel, an independent cannabis consultant in Topeka, said that idea did not go over well in the Legislature.

House Sub for SB158 does not address decriminalization of cannabis laws in Kansas, but Barker believes this should be addressed too. Law enforcement should not have to worry about someone with a couple of marijuana cigarettes, he said.

Legalization has been slow to come to Kansas. 

"We're in a time of transition, said Rippel, an appointed member of the Industrial Hemp Advisory Board under the Kansas Department of Agriculture.

House Sub for SB158 would specify that only the following forms of medical marijuana may be dispensed,"oils; tinctures; plant material; edibles; and patches."

The bill would "prohibit the smoking, combustion, or vaporization of medical marijuana; any forms or methods of using medical marijuana that are considered attractive to children; and the dispensing of medical marijuana from a vending machine or through electronic commerce."

While the bill may appear to prohibit "smoking medical marijuana," Rippel noted that the bill does allow "plant material" to be sold.

Rippel also said the Commercial Industrial Hemp Act of Kansas needs modified to match the USDA Final Hemp Rule. It may be a slow process, but he maintains there is hope on the horizon. A recent amendment to HB2244, which passed both chambers in the statehouse, is on its way to Governor Kelly's desk. This new law would allow the sale of items with hemp seed and CBD products that contain the federally legal amount of 3% THC.

Medical cannabis typically has 10% to 35% THC. The Barker bill has a cap of 35% THC levels in Kansas.

Michael Hooper is a longtime journalist in Kansas and Nebraska. His blog is thoughtfulinvestors.blogspot.com

San Diego Firm Building New Pet Food Plant Near Topeka, Will Create 40 Jobs

By Michael Hooper

The Honest Kitchen, of San Diego, Calif., is building a new production plant that will employ 40 people near Topeka.

The Honest Kitchen will be manufacturing its Whole Food Clusters kibble alternative, human-grade pet foods with a new state-of-the-art manufacturing facility near Topeka, the company said in a press release issued on March 23. The facility is set to open in the third quarter of 2021, the company said.

“This new facility, once combined with our manufacturing operation on the West Coast, will represent a huge step forward in increasing our overall manufacturing capacity for Whole Food Clusters,” Nate Kredich, chief operating officer of The Honest Kitchen, said in the press release. “We are proud not only of the new jobs that this facility will create in Shawnee County, but also that nearly all of our equipment will be sourced from US suppliers.”

The 100,000-square-foot facility is expected to add 40 new jobs in the Topeka area.

The Topeka area was strategically chosen for its proximity to quality raw ingredient suppliers and because it fosters improved distribution capabilities, reducing transit time to key Midwest and East Coast markets, the company said.

“In a short amount of time, Whole Food Clusters has exceeded all sales and velocity expectations,” added Michael Greenwell, chief executive officer of The Honest Kitchen. “We’re excited to continue the human-grade pet food momentum and meet the growing demand for this revolutionary product. This expansion will allow us to not only scale as needed but accelerate additional innovations within the line.”

The Whole Food Clusters line first launched in 2019 and has recently expanded to include a full assortment of grain-free, whole-grain, puppy and small-breed recipes. The human-grade dog food is produced through The Honest Kitchen’s proprietary MadeHonest™ method, in which each cluster is slow-roasted and gently dehydrated. This process is intended to preserve nutrients and product attributes that are typically lost through high-heat extrusion.

Barbara Stapleton, VP of Business Retention and Expansion at Greater Topeka Partnership, said "we are still operating under the project code name...Project Central."

The company said it plans to spend $9.5 million in facility improvements and equipment and create 50 jobs over the next five years, Stapleton said. 

On Dec. 9, 2020, the Joint Economic Development Organization approved $284,000 in incentives for Project Central.

Stapleton declined to disclose the address of the new pet food plant.

"This is great for Topeka and the Animal Health Corridor," Stapleton said, referring to the KC Animal Health Corridor from Manhattan, Kan., to Columbia, Mo. The Honest Kitchen brings good jobs to Topeka. This will grow opportunities for people who live here or choose to move here, she said.

The Honest Kitchen was founded by Lucy Postins in 2002 in San Diego, with a mission to help as many pets as possible get on the road to good health through good food. They produce a full line of human-grade, complete and balanced foods for pets including dry, dehydrated and wet foods as well as treats, toppers, hydration boosters and a best-selling digestive supplement. The Honest Kitchen says it was the first-ever human-grade pet food, meaning the finished product meets human-food production standards (unlike conventional pet food, which is feed grade). Each Honest Kitchen product is made with uncompromising quality and safety standards by a company of pet lovers. For more information, please visit www.thehonestkitchen.com.

Multiple pet food companies are located in the Topeka area, including Hill's Pet Nutrition. JM Smucker owns Big Heart Pet Brands in Topeka and Lawrence, purchased in 2015. Mars Petcare operates in Kansas City. Crosswind Industries, purchased by ADM for $85 million four years ago, is located in Sabetha, Kan. Simmons Pet Food is located in Emporia. Alphia, formerly called CJ Foods, is based in Bern, Kan.

These pet food companies are part of the KC Animal Health Corridor which includes more than 300 companies and organizations involved in animal health and nutrition. The corridor, founded in 2006, is anchored by veterinary medicine colleges at Kansas State University and the University of Missouri.

A substantial amount of the pet food consumed in the United States comes from this region in the Middle of the United States.

Honest Kitchen founder Lucy Postins started her company with $7,000, and a beach cottage kitchen. She created "the world’s first human grade pet food company," the company says here. "Seventeen years later, our products are distributed in over 5,000 pet supply stores internationally, with a staff of over 50 employees (and probably close to 50 co-woofers).

"I decided to start my own pet food company whilst standing in my kitchen, after marveling at the amazing impact that a healthy, whole-food diet could have on my own dog’s health," she said. "I’d been trying to address my Rhodesian Ridgeback’s chronic ear infections with vet prescribed treatments but nothing was really bringing about a long term cure. So I turned to food as a potential ‘medicine’ and began feeding him my own home prepared diet. Originally, The Honest Kitchen was just going to be a local direct-to-consumer business but it turned out the products really spoke for themselves and sales started to grow by word of mouth when people began to see the results in their pets’ health, so it gradually morphed into a larger, nationally distributed brand."

In 2015, The Honest Kitchen's revenue was $30 million. That number has grown between 35% to 45% annually, she said in this 2019 article in the San Diego Business Journal.

It's likely the company's revenue is now around $100 million, said David Tangeman, accountant.

The Honest Kitchen received minority venture capital investment from two funds in 2011. One is the Alliance Consumer Growth Fund and the other is White Road Investments, started by Gary Erickson who was the founder of Cliff Bar & Co. 

How Likely Is a Merger Between CP and Kansas City Southern?

                                                Photo courtesy of Kansas City Southern

By Michael Hooper

The U.S. Surface Transportation Board will review the proposed sale of Kansas City Southern (KSU) to Canadian Pacific Railway (CP).

The STB has broad economic regulatory oversight of railroads, including rates, service, the construction, acquisition and abandonment of rail lines, carrier mergers and interchange of traffic among carriers.

Based on my previous coverage of these issues, I expect the STB will examine whether the deal improves or harms service and competition. Former Surface Transportation Board member Deb Miller spoke at length about railroad mergers in this 2014 article I wrote during her time on the board. Hunter Harrison had tried to get some merger activity going at CSX (CSX) with Canadian Pacific in 2014 but without much luck.

At that time, she said, the STB would look hard at whether any merger would improve service and competition.

"We would be very reluctant to do anything to make service issues worse," Miller told me.

I don't see any reason for major shipping delays as a result of the merger of CP-KSU. They don't overlap. 

Mergers were common in the rail industry in the 20th Century. It was either get larger or die trying to compete. Yet mergers haven't been so frequent in the past 20 years. Now there are just seven Class 1 railroads.

There is no guarantee the Surface Transportation Board will approve a merger. In 1999, BNSF Railway and Canadian National Railway (CNI) proposed a merger that would have created the largest transcontinental railway in North America. The Surface Transportation board imposed a 15-month moratorium on new rail mergers. Months later the two railroads called off the merger. Back then shippers complained that past mergers -- Union Pacific's 1996 acquisition of Southern Pacific Rail Corp. and 1999's splitting of Conrail Inc. between Norfolk Southern Corp. (NSC) and CSX -- had caused massive delays and poor service.

The CP acquisition of Kansas City Southern is unique because it involves trade between three countries, Mexico, the United States and Canada. KSU owns Kansas City Southern de Mexico, based in Monterrey. Canadian Pacific will be expanding its global reach across the Midwestern United States and Mexico and giving KSU access to points in Canada and the North and Northeast. This is strategically a good move for CP and generally a win-win for both companies. There is no overlap in rail, no duplication. Indeed, a single-line company moving product over three countries is opening up new markets. 

CP and KSU are among the many beneficiaries of the North American Free Trade Agreement, which eliminated all tariffs and quotas on US exports to Mexico and Canada.

The CP-KSU combination would not eliminate competition. A primary competitor in the NAFTA business is Union Pacific, which has the most connections with Mexico of any railroad in the U.S. UP serves the six border crossings of Brownsville, Texas; Laredo, Texas; Eagle Pass, Texas; El Paso, Texas; Nogales, Ariz. and Calexico, Calif.

In a way, the proposed CP-KSU merger reminds me of the Canadian National Railway acquisition of the Illinois Central in 1998. That acquisition gave CN ownership of a Chicago-New Orleans route, thus giving CN access the Gulf Coast waters along with already longtime historic connections to the Pacific and the Atlantic in Canada.

On March 21, Canadian Pacific and Kansas City Southern announced they have entered into a merger agreement, under which CP has agreed to acquire KCS in a stock and cash transaction representing an enterprise value of approximately USD $29 billion, which includes the assumption of $3.8 billion of outstanding KCS debt. The companies said they were offering 23% premium, based on the CP and KCS closing prices on March 19, 2021, but CP's price fell 7% after the deal was announced while KSU stock was up 10%.

Shareholders of KCS will receive 0.489 of a CP share and $90 in cash for each KCS common share held, according to a joint company statement.

Joining in Kansas City, Mo., the statement said the combined company will connect customers via single-network transportation offerings between points on CP’s system throughout Canada, the U.S. Midwest, and the U.S. Northeast and points on KCS’ system throughout Mexico and the South Central U.S., the companies said. 

The combined company will operate approximately 20,000 miles of rail, employ close to 20,000 people and generate total revenues of approximately $8.7 billion, the companies said.

The companies expect synergies of approximately $780 million over three years.

To fund the stock consideration of the merger, CP will issue 44.5 million new shares. The cash portion will be funded through a combination of cash-on-hand and raising approximately $8.6 billion in debt, for which financing has been committed. As part of the merger, CP will assume approximately $3.8 billion of KCS’ outstanding debt. Following the closing into trust, CP expects that its outstanding debt will be approximately $20.2 billion, the companies said.

Stockholders betting on a merger are taking a calculated risk. This deal does not have much overlap in rail lines and will create longer single-line delivery methods for customers. CP will gain valuable access to Midwest US and Mexican rail lines, giving customers more destinations for delivery.

As of this writing, KSU stock was trading at a 6% discount to the acquisition price. We may see a trading discount due to the long regulatory process typically involved in a deal of this scale. Whether the deal goes through, I think shareholders are wise to hold onto their assets. There aren't many Class I railroads available for public ownership, so it's best to own what we can. Margins have improved in recent years in the rail sector, making them attractive investments. 

If KSU stock gets folded into CP, that is one less investment possibility in the rail investment world. And for investors like me who like railroads, that will be a disappointment. Nevertheless, I give the CP-KSU merger a 51% possibility. This deal will create new shipping options for customers because one company will cover three countries under the North American Free Trade Agreement. This deal could lead to new or expanded markets for customers.

Editor's note: The Author owns shares in UNP, NSC, CNI and BRK.B.

Railroads Haul More Containers in Q1

BNSF Railway Shops, Topeka

By Michael Hooper

A review of the weekly volume reports at BNSF Railway, Union Pacific and Norfolk Southern (NSC) shows that while carloads may be down so far in Q1, container and trailer volume is up. Ports have been backlogged with ships waiting to unload containers.

At Norfolk Southern (NSC) intermodal volumes -- containers and trailers -- were up 5% Year To Date through Week 9, ended March 6.

At BNSF Railway (owned by Berkshire Hathaway (BRK.B), container and trailer volume were up 14% YTD through Week 10, ended March 13. For many months there has been a backlog at the Los Angeles and Long Beach ports, where BNSF Railway and Union Pacific pick up freight and haul to Chicago and other places.

The ports in Los Angeles and Long Beach have been dealing with delays since June 2020, according to Ian Putzger in the Loadstar.

Container and trailer traffic at Union Pacific was up 8% YTD through Week 11, March 20.

Winter storms slowed down volumes of freight for the railroads in February, this harsh weather event, that included many days of freezing weather, will most likely affect first quarter earnings.

Union Pacific is trading with a 27 P/E ratio and a forward P/E of 19.9. The dividend yield on this stock is 1.82%. Historically, the yield on the stock is around 2% to 2.5%.

I expect volumes should be improving into the summer months.

Union Pacific, BNSF Railway, Canadian National Railway and Canadian Pacific will be the beneficiaries of all that freight coming into the west coast ports from Asia. Norfolk Southern and CSX (CSX) benefit from freight on the East Coast ports.

Railroad margins have improved in recent years, making these attractive investments. Net profit margins at Norfolk Southern (NSC) and Union Pacific (UNP) are around 26%.

There's so much pent-up demand among consumers; this demand will translate into more freight and merchandise being moved over rail and road. Financial metrics such as P/E ratio, yield and price-to-book ratios indicate these railroad stocks are trading above their historic averages, but there is a good reason to hold. There are just seven Class I railroads in the United States and Canada. Only six of them are publicly owned. With the potential for Canadian Pacific (CP) acquiring Kansas City Southern (KSU), there will be one less publicly-owned Class 1 railroad stock if the deal goes through.

Conclusion

I am bullish on rail stocks. Shippers will move steady-to-growing amounts of freight as we head into the summer months. These railroads are big cash machines with the ability to ebb and flow with the economy. The economy contracted during the pandemic of 2020, yet these railroad stocks were up. Railroads remain profitable and did not have to cut their dividends. I recommend holding these railroad assets for dividend income and modest growth in 2021.

Editor's note: The author owns UNP, NSC, CNI, BRK.B.

Brad Garlinghouse Fights SEC Lawsuit Over Crypto Sales

Brad Garlinghouse speaks at Topeka High School in 2017

By Michael Hooper

Brad Garlinghouse, CEO of Ripple Labs Inc., plans to file a motion to dismiss a lawsuit against him by the Securities and Exchange Commission over the sale of his XRP cryptocurrency.

Garlinghouse, a graduate of Topeka High School, has been fighting this lawsuit for two and a half years.

"After a 30-month investigation and after the production of more than 200,000 pages from the defendants and third parties, the best the SEC can do is allege that Mr. Garlinghouse was generally aware of the risk that some digital assets could possibly be deemed to be securities but that he worked hard to ensure that XRP did not even appear to have those features," says a letter by Matthew Solomon, on behalf of Brad Garlinghouse.

The SEC alleges Garlinghouse sold over 357 million of his XRP for approximately $159 million and that these transactions occurred at various digital asset trading platforms. Garlinghouse also directed sales of some of his company's XRP. Garlinghouse attorney Solomon says those platforms alleged by the SEC seem vague and seem to obscure what the SEC knows but merely hints at with passing reference to Mr. Garlinghouse's worldwide sales. The truth is that the vast majority of Mr. Garlinghouse's XRP sales were made on foreign exchanges and those transactions do not and cannot violate the federal securities law, Solomon wrote.

Yesterday on Brad Garlinghouse Twitter account, he posted a tweet saying, "Today, a letter was filed on my behalf indicating my intent to file a motion to dismiss in response to the SEC's amended complaint against me. Simply put the SEC's allegations are regulatory overreach."

The SEC says that XRP is a security and should have been registered with the SEC as such. The SEC says XRP is a security because of "an investment contract."

Yet Solomon says the SEC fails to understand the XRP market for the past eight years. XRP, he says, is a digital asset used to make faster, cheaper, and more efficient payments and money transfers. That is the business model at Ripple.

Garlinghouse has said Ripple sells a blockchain technology to banks and payment providers to do real time settlement between banks. He says the current banking system for settlement between U.S. and foreign banks is lengthy and time consuming.

I know Bitcoin is considered a commodity by the SEC. Why would XRP be any different? XRP is listed as one of the top cryptocurrencies in the world by market capitalization on the top cryptocurrency websites, such as coinmarketcap.

Garlinghouse, the son of Kent and Susan Garlinghouse of Topeka, is a graduate of University of Kansas and Harvard Business School.

When XRP was trading around $2.50 to $3.00, Forbes published an article in January 2018, saying Garlinghouse was worth $9 billion. But XRP fell from those highs to $0.47 cents in recent trading.

Brad Garlinghouse was inducted into the Topeka High School Hall of Fame in 2017. Here is an article about that event.

Two Prolific Artists: O'Keeffe & Picasso

Pablo Picasso in his 20s in Montmartre, the golden age of his early years in Paris.

Corn, Dark I, by Georgia O'Keeffe

By Michael Hooper

Trying to stay warm this winter, I have sat by the fireplace reading biographies about two great artists: Georgia O'Keeffe A Life by Roxana Robinson, and Picasso Creator and Destroyer by Arianna Stassinopoulos Huffington. I couldn't have picked two more fascinating and independent people, O'Keeffe is escaping from patronizing men into an independent feminine mystique while Picasso the raging bull has extensive relationships with multiple women. Both artists lived into their 90s yet made their mark at various stages in their lives. 

Georgia O'Keeffe became known for a very distinctive style of color patterns of nature, especially in the Southwest where her views of the desert landscape and big sky were evocative and much loved. She was also known for her enlarged flowers that had a sexuality about them.

O'Keeffe was married to Alfred Stieglitz, the famed photographer and gallery promoter who sold her work. Some of her paintings sold for thousands of dollars in the 1930s. Stieglitz photographed O'Keeffe nude and exhibited the photographs as art. O'Keeffe painted leaves, branches or bones she found on walks. She worked in a studio that was a former shack on the Stieglitz family farm at Lake George, N.Y.

O'Keeffe moved out west for the back half of her life, settling at Ghost Ranch, New Mexico. Eventually one of her hired hands Juan Hamilton takes control with power of attorney over her finances and inherits most of her money through changes in her will. Her estate was worth $70 million. Her family sued and received a settlement.

At one time O'Keeffe had a chance to be introduced to Picasso but she declined the offer because she said they wouldn't be able to speak to one another, according to Robinson's book.

Pablo Picasso was a precocious child prodigy from Malaga, Spain, who could draw anything and excelled beyond his father who was an art teacher. When Picasso was almost 19 years old, he arrived in Paris speaking no French and having no place to stay but quickly found an art studio and fell into Parisian life of cafes and shows, artwork and brothels. He learned to speak French and lived in France most of his life. 

Picasso emulated multiple styles and was an inventor of styles like his African-influenced period and his cubism. He was good at every style he worked in. Picasso's Rose Period, his Blue Period and his Cubism all are so fascinating. I saw his Old Guitarist at the Guggenheim. Picasso was quick to draw and paint canvases; he produced tens of thousands of works of art, sculpture and drawings.

Yet Huffington spends much of her book on the woman's point of view, the day-to-day living with this insufferable man with a raging passion for sex. Picasso would find a model and then keep her around and sleep with her and sometimes marry her or just put her on the payroll. Dora Maar is a good example of a model with a sexual relationship with him while he was still attached to another woman. His infidelity would drive women crazy. Yet his life with them was often brilliant with encounters with Henri Matisse and Gertrude Stein and other interesting people of the day. Dora Maar was not the same person after Picasso got rid of her.

Huffington depends largely on the published works and interviews with Francois Gilot, Picasso's former former lover and mother of Claude Pierre. Gilot published a memoir, "Life With Picasso" in 1964 with author Carlton Lake.

I enjoyed reading about Pablo Picasso in his 20s in Montmartre, the golden age of his early years in Paris. Before long, he had met Gertrude Stein in Paris, and many other artists. Picasso had his gang of friends. They would go to bull fights. Somehow he became a member of the Communist Party. It's kind of a strange trip in the end, very sad when he shuns his children and grandchildren.

With the O'Keeffe book, I got a sense of O'Keeffe's feeling and intuition in art. The Picasso book was a very good book too, but felt it could have provided more discussions and photographs of his artworks and how Picasso was so influential with certain artworks. Both books are enriching and entertaining. Both Picasso and O'Keeffe led long and prolific lives.

Huge Opportunity in Coinbase Stock

By Michael Hooper

The opportunity to own stock in Coinbase Global Inc. is huge. The company plans a direct listing of shares on March 14 on the NASDAQ. Once shares begin trading I plan to buy them. This company is the leading trading platform for Bitcoin and other crypto currencies. I've used Coinbase successfully to buy and sell Bitcoin and ethereum since 2017.

The direct listing price of the stock will likely be very high. The trading ticker for Coinbase is (COIN). Anyone with an account at a stock brokerage can buy the stock after the direct listing. On Thursday Feb. 25, 2021, the company made a filing of S-1 Prospectus with the Securities and Exchange Commission.

There was a private sale of 127,000 shares at $373 per share which works out to a valuation of $100 billion, according to Axios.

Due to increasing popularity of Bitcoin and other cryptocurrencies, I expect the direct listing of Coinbase to generate huge support.

Coinbase states that it currently has about 43 million retail users, 7,000 institutions, and 115,000 ecosystem partners in over 100 countries.

As of Dec. 31, 2020, the platform had executed $456 billion in trading volume since its inception and stored over $90 billion worth of assets. In May 2020, the company with 1,200 employees became “a remote-first company,” which means they work remotely first with no headquarters yet maintain some physical offices.

Coinbase reported $322 million of profits on $1.28 billion in revenue for 2020, compared to a $30 million net loss on $534 million in revenue for 2019.

The largest single owner of Coinbase stock is Marc Andreessen at 24.6% of stock. Brian Armstrong, CEO, owns 21% of Coinbase stock.

Critics complain of Coinbase's high fees for transactions. There are other trading platforms like uniswap that may prove to be more competitive.

There are other risks. What if the crypto markets suffer a crash and a long bear market? There will be ebbs and flows of people in and out of it. But long term I think crypto is here to stay.