This week, Coinbase executed a direct listing after which the shares of a company opened for trade from a reference point of $250 to $381, a change of 52%. When the trade opened, Coinbase was valued at $99.6 billion on a fully diluted basis. As of the time of writing Coinbase has appreciated further to just over $400 per share, bringing the company’s value to a little more than $104 billion.
The progress makes Coinbase live up to expectations
At its reference point, Coinbase was worth $65.3 billion on a fully diluted basis. Considering the company’s reputation inside the greater crypto economy, its debut has been hotly anticipated, and, purely from a startup perspective, its huge value unlocks. When Coinbase was a private company, private investors poured capital into it, valuing it as high as $8 billion.
The previous figure seems dwarf in front of the company’s new valuation. This implies strong returns for its long-term backers. Regular folks are ready to pay up for the privilege of getting a scratch at the company’s equity.
The road ahead for Coinbase seems interesting. The company is richly capitalized and posted monster profits in its most recent quarter. However, the company has yet to register a stable future having no impacts form the cryptocurrency price fluctuations. What it means is that the trading of the company should not suffer a setback in growth and income if the value of bitcoin, et al. dropped.
But for crypto believers, watching the Coinbase list is a win. It is ironic that a traditional company listing on an old-fashioned exchange is a key moment for the crypto economy, but most things come in steps. Perhaps the next major crypto company trading debut will be on a decentralized exchange.