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Coinbase stock breaches $100bn on Nasdaq listing

By Adrian Holliday

06:50, 15 April 2021

Photo of Nasdaq ticker in public place

The Coinbase Nasdaq debut yesterday was a big deal. While shares for the biggest US crypto platform were referenced at $250 a share, trading quickly soared more than 50% above – then popped again, hitting $410 at one point. 

Coinbase ended the trading day at $328.28 which values the company at more than $85bn. But these current steep valuations, as the Financial Time’s Lex column points out this morning, means that Coinbase is valued at “79 times trailing revenue. That requires sales growth that is supersized even by the standards of the tech industry”.

Bitcoin value and regulator anxiety

The starry numbers were also kept aloft by Bitcoin (BTC) hitting fresh highs yesterday – a little below $65,000 – though now the Coinbase IPO is out of the way, there may well be a cooling of cryptocurrency sentiment. 

Many mainstream financial players are also in the throes of readying their own digital wallets that will inevitably gnaw at Coinbase’s margins and revenues. But Coinbase has the momentum for the time being.  

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Coinbase is anticipating first quarter revenues of around $1.8bn with net income between $730m-$830m. Last year, Coinbase made a $322m profit while it saw a loss of $30m in 2019. 

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Sold direct

The Coinbase listing is a little apart from a usual initial public offering (IPO). There was little investment bank choreography involved. Coinbase private shareholders simply sold shares straight to investors on the Nasdaq.  

In theory, this means a better deal for the company itself as some companies can worry about under-pricing. In the background, UK regulators are still mulling issues of consumer protection, particularly as the asset class has become so speculative. 

Read more: Cryptocurrency prices hike ahead of Coinbase listing

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