Please ensure Javascript is enabled for purposes of website accessibility
Coinbase is Here: A Cryptocurrency Exchange Goes Public
gvw_ap_news
By Associated Press
Published 3 years ago on
April 14, 2021

Share

Wall Street will be focused on Coinbase Wednesday with the digital currency exchange becoming a publicly traded company.

Coinbase is making its initial public offering of stock with cryptocurrency chatter seemingly everywhere, even at the U.S. Federal Reserve. It is being incorporated into the business plans and accepted by major corporations like Tesla, PayPal and Visa.

“The Coinbase IPO is potentially a watershed event for the crypto industry and will be something the Street will be laser focused on to gauge investor appetite,'” Wedbush analyst Daniel Ives wrote this week.

There were 43 million verified Coinbase users in 2020, with 2.8 million making transactions monthly. Its revenue more than doubled to $1.14 billion last year and the company swung to a profit of $322.3 million after losing tens of millions in 2019.

Coinbase to File Through a Direct Listing

An organization that deals in cryptocurrency, which is often used as away around institutional monetary systems and control, is an odd fit for a publicly traded company, which must file quarterly reports with regulators.

However, when Coinbase filed papers with U.S. regulators this year to go public, it said it would do so through a direct listing. That means it has avoided the typical agreements with big banks that would typically buy thousands of shares and promote them.

A direct listing allows insiders and early investors to convert their stakes in the company into publicly traded stock, which will hit the market Wednesday with no set price, as is the norm when an IPO is handled by big banks.

That could mean wild price swings when the stock ticker goes live. This week, Nasdaq gave the company’s stock a $250 reference price. That is unlikely to stick.

Shares of Coinbase, which will be traded on the Nasdaq under the ticker “COIN,’ will attract investors who want to get into the cryptocurrency space in addition to, or without buying any coins at all, said Lule Demmissie, president of Ally Invest.

“It could also be a less volatile security than the coins themselves,” Demmissie says.

Projected Value at $100 Billion

Some Wall Street analysts project that Coinbase Global Inc. could be valued at $100 billion, based on private transactions of its shares.

That would make it one of the top 100 biggest publicly traded U.S. companies that will be far larger than the New York Stock Exchange or Nasdaq.

The Coinbase hype went into overdrive last week when the company reported estimates of its first-quarter results, including about $1.8 billion in revenue and net income between $730 million and $800 million.

Still, not everyone is convinced. David Trainer, CEO of investment research firm New Constructs, said Coinbase has “little-to-no-chance of meeting the future profit expectations that are baked into its ridiculously high valuation.”

Trainer last week put a valuation on Coinbase closer to $18.9 billion, arguing it will face more competition as the cryptocurrency market matures.

However Ives, of Wedbush, sees Coinbase as a window into the future.

“Coinbase is a foundational piece of the crypto ecosystem and is a barometer for the growing mainstream adoption of Bitcoin and crypto for the coming years,” Ives said.

RELATED TOPICS:

DON'T MISS

Caitlin Clark and Iowa Draw Nearly 5 Million Viewers for Second-Round NCAA Win

DON'T MISS

Canadian School Boards Sue Snapchat, TikTok and Meta for Disrupting Students’ Education

DON'T MISS

California Law Enforcement Agencies Obstruct Transparency Efforts in Use-of-Force Cases

DON'T MISS

No Police Charges for Taylor Swift’s Dad Over Paparazzi Incident in Sydney

DON'T MISS

Biden Administration to Lend $1.5B to Restart Michigan Nuclear Power Plant, a First in the US

DON'T MISS

Tonight’s Biden Fundraiser With Obama and Clinton Already Nets a Record $25 Million

DON'T MISS

Former Sen. Joe Lieberman, Democrats’ VP Pick in 2000, Dead at 82

DON'T MISS

Trump Criticizes Judge and His Daughter After Gag Order in Hush-Money Case

DON'T MISS

Police Had About 90 Seconds to Stop Traffic Before Baltimore Bridge Fell. 6 Workers Are Feared Dead

DON'T MISS

NBC Has Cut Ties With Former RNC Head Ronna McDaniel After Employee Objections, Some on the Air

No data was found

Facebook News Tab Will Soon Be Unavailable as Meta Scales Back News and Political Content

3 hours ago

Stock Market Today: Wall Street Rises to More Records to Close Out Its Latest Winning Month

3 hours ago

A Fresno County First: Kerman Council Passes Amended Gaza Cease-Fire Resolution

3 hours ago

UN Top Court Orders Israel to Open More Land Crossings for Aid into Gaza

3 hours ago

How Involved Is Southern California Consulting Firm in FUSD Executive Dealings?

3 hours ago

Biden’s Fundraiser with Obama and Clinton Nets a Record $25 Million, His Campaign Says

4 hours ago

Fresno Unified’s Self-Protection Racket Is Hurting Our Kids

4 hours ago

Rockin’ Out or Laughing, the Valley Has Its Pick of Weekend Events

5 hours ago

Ex-Correctional Officer at Women’s Prison in California Sentenced for Sexually Abusing Inmates

7 hours ago

Caitlin Clark and Iowa Draw Nearly 5 Million Viewers for Second-Round NCAA Win

8 hours ago

PGA HOPE at Riverside Golf Course Introduces Military Veterans to the Game

PGA HOPE, now underway at Fresno’s Riverside Golf Course, is designed to introduce golf to veterans and active duty military members t...

56 mins ago

PGA HOPE at Fresno's Riverside Golf Course
56 mins ago

PGA HOPE at Riverside Golf Course Introduces Military Veterans to the Game

2 hours ago

Cronenworth’s Big Hit Helps Lift the Padres to a 6-4 Win Over Melvin’s Giants

2 hours ago

Shohei Ohtani Reaches 3 Times in Home Debut as the Dodgers Rout the Cardinals 7-1

3 hours ago

Facebook News Tab Will Soon Be Unavailable as Meta Scales Back News and Political Content

3 hours ago

Stock Market Today: Wall Street Rises to More Records to Close Out Its Latest Winning Month

3 hours ago

A Fresno County First: Kerman Council Passes Amended Gaza Cease-Fire Resolution

3 hours ago

UN Top Court Orders Israel to Open More Land Crossings for Aid into Gaza

3 hours ago

How Involved Is Southern California Consulting Firm in FUSD Executive Dealings?

MENU

CONNECT WITH US

Search

Send this to a friend