Coinbase IPO is valued at almost 70 bn dollars
Many investors are not happy with the high valuation of the crypto exchange.

After years of shunning Wall Street and traditional financial markets, bitcoin and cryptocurrencies are finally enjoying their moment in the sun. Bitcoin price is currently trading within grasp of its all-time high of $ 61,000, which it hit in March, which is a far cry from its price of $ 3,000 just a year ago. Bitcoin owes its insane rally to its increasing adoption by Wall Street and some of the world's largest and best-known institutions and companies like Visa Inc. (NYSE: V), Square Inc. (NYSE: SQ), PayPal Holdings (NASDAQ: PYPL), and Tesla Inc. (NASDAQ: TSLA). That makes the looming IPO of the world's largest crypto exchange all the more convincing. The giant cryptocurrency exchange Coinbase Global Inc. is about to become a public company - a first for a cryptocurrency exchange. Coinbase will list on the tech-heavy NASDAQ platform at an implicit valuation of $ 68 billion, a huge increase from its valuation just a few years ago. But investors who can't wait to make a fortune by listing Coinbase will have to wait a little longer: Coinbase will go public via a direct listing and not via the usual Initial Public Listing (IPO) process, who takes an example from companies like Palantir (NYSE: PLTR), Spotify (NYSE: SPOT), and Slack (NYSE: WORK). Direct quotes simply mean that early investors and employees get the chance to convert their shares into stocks. No underwriters are involved in direct listings and no new shares are created, only existing, outstanding shares are sold. Record sales Coinbase couldn't have picked a better time to go public. The latest valuation, based on a revised S-1 filing released Wednesday, shows that the company's private shares traded at $ 343.58 apiece in the first quarter of 2021, up 1,300% year over year. That gives the company a valuation of $ 68B compared to $ 8B in October 2018, according to PitchBook Data. Coinbase's revised regulatory filing reveals that the company had more than 196 million shares outstanding in the first quarter of 2021. Nasdaq will use this information to establish a reference price for the shares prior to listing. But aside from the lingering crypto mania, there's another - even better - reason why Coinbase's valuation has soared: solid finances. The company reported profits of $ 322 million on sales of $ 1.1B in its first public filing in February, good for a 100% top-line increase year over year. But that's just one of several factors in favor of Coinbase. Hot on the heels of the Coinbase IPO is Bakkt, another crypto exchange that recently announced plans to go public via a SPAC merger. Other unicorn IPOs last year including Airbnb Inc. (NASDAQ: ABNB), the popular online home rental marketplace, and DoorDash Inc. (NYSE: DASH), an on-demand logistics-based startup, were home runs, with ABNB stock up nearly 160% and DASH up 90% since their respective IPOs. Airbnb is currently valued at $ 19.8 billion, which is significantly higher than rating older competitors like Booking Holdings (NASDAQ: BKNG) and Expedia Group (NASDAQ: EXPE) with market caps of $ 98.2 billion and 25, respectively. $ 4 billion. As the first crypto exchange to go public, it's hard to project how the market will value Coinbase. But in its favor, Coinbase has been consistently profitable for years, something that few unicorns including Airbnb and DorDash can claim to be. Still, Coinbase has a few hurdles to overcome before it can finally join the thousands of other companies in the public arena. A real controversy That said, Coinbase's listing is not without its controversy. After all, Coinbase is no stranger to serious scrutiny by regulators. In fact, Coinbase has dealt with regulatory scrutiny over the years, including filing information about 13,000 customer accounts to the IRS in 2018 that held more than $ 20,000 in cryptocurrencies between 2013 and 2015. Further, Coinbase has had, with its fair share of disgruntled customers, with Mashable in 2018 uncovered more than 115 customer complaints about issues ranging from site outages and lack of funds to the lack of customer service. Coinbase has frequently suffered website outages at critical times, including during periods of heavy trading, with the outages becoming a reputational risk for exchanges. In addition, Coinbase's recent decision to stop trading XRP on January 19 over the dispute with the SEC has angered dozens of customers, leading to lengthy legal proceedings. Given its checkered track record, not least because it is a large and very prominent cryptocurrency company, Coinbase could be burdened with regulatory bureaucracy that could result in many months passing before the SEC finally gives the nod for the long-awaited listing. But crypto cops have been waiting for this moment for years, and waiting a few more months, or maybe even a year, can't hurt too much. In fact, some crypto insiders have welcomed the upcoming regulation as they drive it as another step in crypto legitimation that is likely to attract more institutional capital into the industry. As Flori Marquez, founder of crypto lender BlockFi, aptly put it: "There's an increased focus on regulators when it comes to looking at this asset class. Knowing that you have a crypto company in front of the SEC that is actively engaged in discussions about how to make it easier for US consumers Investing in this asset class is just big news for the space as a whole ... I think it bodes very well for the future of bitcoin and what companies in this space can do in the future. " But overall, there's little reason Coinbase isn't ready for another home run.





