In January 2021, San Fransisco-based cryptocurrency exchange Coinbase announced plans to go public via a direct listing. The company shared the news in a blog post, in which it announced its intent “to become a publicly-traded company pursuant to a proposed direct listing of its Class A common stock.”
Coinbase is one of the largest well-known digital currency exchanges in the world. It’s widely considered one of the most accessible and allows users to purchase crypto using fiat currencies. Coinbase has received approval from the U.S Securities and Exchange Commission (SEC) to list its shares on the Nasdaq, paving the way for what will be a landmark victory for cryptocurrency advocates. Companies like Roblox, Spotify, Slack, and Palantir previously went through a direct listing on New York Stock Exchange. Coinbase will be Nasdaq’s first prominent direct listing.
In a direct listing, the issuing company forgoes selling new stock and instead allows existing stakeholders to sell their shares to new investors. The direct listing helps Coinbase to avoid onerous requirements of an IPO and dependency on intermediaries known as underwriters.
Coinbase Shares didn’t become available to the public until 14 April. They have been trading actively on forums like Nasdaq Private Market, which launched a secondary market for Coinbase stock. Coinbase began trading on Wednesday morning from its headquarter in San Francisco.
Coinbase had decided to hand out 100 shares to its approximately 1700 employees around the world. That means that every full-time employee at the company poise to become $25,000 richer based on a $250 reference price by the NASDAQ stock exchange. The price at which the stock begins to trade, however, could be higher – lower.
To celebrate its public listing, Coinbase embedded a secret message on the first Bitcoin block that is mined following its Nasdaq listing. The message today reads: “NYTimes 10/Mar/21 House Gives Final Approval to Biden’s $1.9T Pandemic Relief Bill.”
Coinbase wrapped its first day of public trading on Nasdaq with a share price of $328. It’s down 14% from its debut at $ 381, but still up 31% from the reference price of $ 250.
Recent Trade has valued the stock at $350 a share, which would place the company’s total valuation around $90 billion. Last month, an updated filing revealed that Coinbase had reached an implied $68 billion private market valuation, based on an average share price of $ 343.58.
Rival crypto exchange Binance has also announced that it will list a Coinbase stock token against the stable coin BUSD. This means users of the crypto exchange will trade a fraction of Coinbase stock after it listed on the Nasdaq.
