If you've missed Bitcoin's rally don't miss Coinbase $100B IPO for an entry in the cryptocurrency world

We are moving fast into a digital economy where cryptocurrencies are now becoming the new stocks.

For many investors, whether they like stocks or cryptos Coinbase IPO this week is an entry into the $2 trillion cryptocurrency market. This can be a great opportunity for investors who are looking to get equity-tied exposure to the cryptocurrency world by settling portfolios roiled by the asset class volatility.

We have seen various stocks tied to the blockchain theory where big companies such as Elon Muck’s Tesla and Michael Saylor’s MicroStrategy have added billions of dollars worth of Bitcoin. With Bitcoin touching $61,229 on Monday almost touching the March 13 peak of $61,742 investors’ interest is embracing Coinbase listing.

Summary

  • Coinbase is planning to go public through a direct listing on the NASDAQ Stock Exchange on April 14.
  • According to Forbes, the market has valued its pre-IPO at $100 billion however Seeking Alpha’s valuation is at $50 billion.
  • This can be a great opportunity for people who are looking to get equity-tied exposure to the cryptocurrency world by settling portfolios roiled by the asset class volatility.
  • Last Tuesday Coinbase said that it expects to report approximately $800 million in the first quarter of 2021. This is double what it earned in 2020 alone.
coinbase IPO

About the Coinbase IPO

However, it will not raise new capital from this as mentioned in its S-1 filing in February. The direct listing of digital-token Coinbase Global Inc. and will be the first major cryptocurrency company to test investor’s appetite for other start-ups in the sector that might follow. The company will be traded under the ticker COIN.

Coinbase listing on the Nasdaq is as bullish a signal as possible at this current stage,” Antoni Trenchev, co-founder of crypto lender Nexo, said in an email to Bloomberg on Friday.

The company is going public at a very good time, in my opinion, and timing is proven to be important in many cases. For example, Robinhood’s listing this year does not seem to have the same interest especially after the retail investor broken trust with the GameStop (GME) craze.

Goldman Sachs Group Inc. announced its almost available to offering investment vehicles for Bitcoin and other digital assets to private wealth clients. Furthermore, Morgan Stanley plans to give rich clients access to three funds that will enable crypto ownership. PayPal Inc. and Visa Inc. have also begun using cryptocurrencies on their platforms. This is just another proof that the economy is changing and it is changing faster than we think.

According to Forbes, the market has valued its pre-IPO at $100 billion however Seeking Alpha’s valuation is at $50 billion. Both valuations are of impressive numbers and I personally do not remember any similar valuations before. It has been given a pre-IPO valuation of $100 billion by Forbes, $50 billion by Seeking Alpha and in an article published by Coindesk, its stock listing is at anywhere from $230 billion to one-twelfth that amount.

Source: https://www.coinbase.com

About Coinbase

Coinbase is an American cryptocurrency exchange platform that operates remote-first without an official physical headquarters. The company was founded in June 2012 by Brian Armstrong and Fred Ehrsam.

Coinbase has around 56 million retail investors on its platform and about 7,000 institutional investors in more than 100 countries around the globe. Its current trading volume is $335 billion, where investors have over $90 billion worth of assets stored in its platforms thanks to Bitcoin jumping almost 800% in the last 12 months and the Nasdaq being up a mere 65%.

Last Tuesday Coinbase said that it expects to report approximately $800 million in the first quarter of 2021. This is double what it earned in 2020 alone. The bumper quarter for the exchange comes amid surging cryptocurrency prices. The Bloomberg Galaxy Crypto Index, tracking Bitcoin, Ether and six other cryptocurrencies, advanced by more than 100 percent in each of the last two quarters.

Coinbase Competition

In my eyes, Coinbase will face strong competition in the future only when another exchange or broker brings cryptocurrencies to commission-free trading. For now, Coinbase is a very trusted exchange with strong brand recognition. “Other exchanges will have to find other ways to compete with them. If another company can find a way to monetize in other ways and make it easy, it could be a blow for Coinbase,” says Brandon Burgason, Founder & CEO of Mobie, a mobile app allowing for payments in crypto and fiat.

Keep in mind that there many exchanges out there and is about time that they will all start exploding one by one. If you are a stock investor compare Coinbase to Tesla. Tesla was the sexiest EV in town, until NIO, XPeng, Volkswagen, Li Auto, and the list goes on, did their appearance and stole from its market cap. I believe Coinbase will face similar situations in the future.

Look at Binance. It is the worlds’ largest cryptocurrency exchange founded by Forbes-listed billionaire Changpeng Zhao, aka CZ. Binance is also doing great especially in the last two weeks looking at its BNB token increasing dramatically from $200 to $600. What is more, it also has strong brand recognition, a user-friendly interface, and security. However, Binance is currently facing a compliance issue in the U.S.

That being said, Coinbase is the first and only crypto exchange to be publicly available to a wider space of investors.

Disclaimer – I/we have no position in any stock mentioned. I wrote this article myself, and it expresses my personal opinions. I am not receiving any compensation for it, other than FDGT Academy. I do not have or had in the past any business relationship with any company that is mentioned in the above article.

Natalia C. - Junior Analyst at FDGT Academy

Natalia C. - Junior Analyst at FDGT Academy

I am a stock analyst/investor with prior experience and knowledge to BSc Accounting and Finance. After completing my degree and exposure to the accounting firms I decided that the direction I should choose is towards the Investment world. I completed my masters in Investment Management where it gave me solid fundamentals to build my career on. I have examined a lot of different aspects of investment, from REITS, derivatives, currencies, bonds, equity and hedge funds. I never stopped learning about the market which is why I can analyze and write articles for FDGT community always personally opinionated. My passion are green energy and electric vehicles stocks as a whole. I also had my share of analyzing the work form home stocks that are coming to take over in the upcoming years.