Everything You Need to Know About Coinbase IPO
Crypto News

Everything You Need to Know About Coinbase IPO

One of the oldest, most popular and well-known cryptocurrency exchanges Coinbase is launching its initial public offering this Wednesday. Coinbase will be the first cryptocurrency-related company to do so. On Nasdaq, Coinbase’s stocks will be traded under the ticker COIN. There are 114,850,769 shares of stock listed by Coinbase. The company is valued at $100 billion by some while others argue that the real value is around $20 billion. Some experts already call this IPO the most important IPO of 2021. Below we will sum up everything we should know about this breakthrough listing.

  1. What Coinbase Has Accomplished As of Today?
  2. What Does This IPO Mean For Coinbase and Crypto Industry In General?
  3. Is It a Good Idea to Invest In Coinbase?

What Coinbase Has Accomplished As of Today?

Coinbase has been existing for a long time. The company was launched in 2012 in the US by Brian Armstrong and Fred Ehrsam. The best known Coinbase products are a crypto exchange (Coinbase Pro) and crypto wallets. In the USA, Coinbase is the largest crypto exchange in terms of trading volume.

Unlike many early crypto exchanges, Coinbase Pro has always been striving to follow the laws and regulations. For several huge exchanges the US laws were too tough so they preferred to fully abandon the American market rather than to follow the rules. Coinbase was a company that decided to stick with the regulations and turn it into its power. For instance, the clean legal status of Coinbase turned its trading platform into one of the safest crypto exchanges.


Trade With Up To 125X Leverage on Binance

The functionality of Coinbase isn’t that impressive for experienced traders. The fees are quite high, too. There are other high liquidity exchanges that seriously outperform Coinbase by the number of the supported coins. For instance, HitBTC supports over 470 coins; Binance has nearly 300 currencies. However, Coinbase’s customers can rest assured their coins are safe on the platform. The exchange has a beginner-friendly design. Coinbase Pro is usually recommended as a good platform for first time crypto buyers/traders. In this sense, we can say that the fact that Coinbase will be the first crypto platform for Nasdaq is somewhat symbolic.

According to the Coinbase website, there are over 56 million verified users on the platform now. There are over 20 million daily visits on Coinbase Pro while the 24h trading volume exceeds $2.5 billion. There are over 1,700 employees working for the company. 2019 was unprofitable. In 2020, Coinbase made $322 million. Officially, 87% of this money was earned by trading cryptocurrencies. The annual profit exceeded the 2019’s income by 139%. By some accounts, the figures are even much better. In 2021, the growth became faster. Most parameters in the first quarter saw the increase by 30 to 50%.This growth alongside the boosting crypto market made it possible for Coinbase to head for a greater exposure via IPO. 

What Does This IPO Mean For Coinbase and Crypto Industry In General?

Despite the fact that Coinbase is already a very popular company and the crypto market is on the rise, such an IPO can introduce both the exchange and the industry to the new market players. For some people this listing is a signal saying that the cryptocurrency business isn’t a shady obscure industry with a dubious reputation. The stigma of cryptocurrencies as a crime currency is fading away and the IPO is a serious step ahead on this way.

It is not an exaggeration. The IPO process means that the company will open a part of its documentation to the side professionals namely investment bankers. Companies that do IPOs are trusted by wide audiences, they have better finance, and can develop faster. Most probably, the potential success of Coinbase IPO will make it easier for other crypto giants to get to the stock market which in perspective can seriously increase the mass adoption of cryptocurrencies and blockchain technology in general.

Is It a Good Idea to Invest in Coinbase?

There is no way to predict if this IPO will be a success or not. In general, experts advise to invest in the companies that already have proved themselves great on the market. New Constructs CEO David Trainer says that the $100 billion valuation is a mathematical impossibility meaning that the hype is based on ill-founded calculations.

Investing in Coinbase is riskier than in more established public companies so it’s up to you if you want to take a chance with it. There’s the opinion that investing in Coinbase is a kind of investing in the future success of the overall cryptocurrency.

The opinions and assessments expressed in the text are the views of the author of the article and may not represent the position of Cryptogeek. Do not forget that investing in cryptocurrencies and trading on the exchange is associated with risk. Before making decisions, be sure to do your own research on the market and the products you are interested in.

Author avatar

Written by

Journalist, cryptocurrency enthusiast. I’ve being investing in cryptocurrencies since 2016. I hold a Bachelor’s degree in civil engineering. Political views: Conservative right wing

Source link