By
Steve Muchoki
May 13th, 2024
Coinbase will make its public debut on the Nasdaq at an unspecified date under the ticker symbol (COIN) and this will be through a direct listing, an approach that is markedly different from the traditional IPOs.
American cryptocurrency exchange Coinbase Global Inc has submitted plans to sell 114.8 million shares of Class A common stock in a direct-listing initial public offering (IPO) on the Nasdaq Global Select Market. According to an amended filing lodged with the Securities and Exchange Commission (SEC) on Wednesday, the company is proposing a maximum aggregate offering price of $943.2 million.
The cryptocurrency trading firm noted that the least and highest sales prices of its Class A and Class B common stock in private transactions during the first quarter came in at $200 and $375.01, respectively, with an estimated average price per share of $343.58. The company reiterated that the final offering price of its shares at the point of listing will not be determined by the pricing in the private markets.
Coinbase will make its public debut on the Nasdaq at an unspecified date under the ticker symbol (COIN) and this will be through a direct listing, an approach that is markedly different from the traditional IPOs. While the direct listing method is still building momentum, firms like American video game developer, Roblox Corp (NYSE: RBLX) went public on the New York Stock Exchange (NYSE) earlier this month via this method. Roblox shares surged 7.75% following the listing, netting a market capitalization of $38.2 billion.
Companies that use the direct listing method bypass the role of underwriters and focuses on selling their shares directly on their chosen exchange in a single large transaction.
Coinbase Direct Listing Is a Landmark Pace for the Cryptocurrency Industry
The proposed direct listing plan to become a public company by Coinbase, one of the largest cryptocurrency exchanges in the world is sure to set a landmark milestone that other exchanges will seek to follow.
The Coinbase move to go public is already causing a ripple effect with the Kraken exchange, another US-based trading platform reportedly mulling the plans to make its public debut by 2022. While the plans are still sketchy, a Kraken executive is ruling out the option of merging with a Special Purpose Acquisition Company (SPAC) noting that the exchange is too big to consider such an option.
Israeli social trading platform eToro also made the news with plans to merge with Betsy Cohen’s SPAC in a bid to go public in the United States. The combined entity if the deal pulls through will be worth as much as $10.4 billion, and the backing will position the outfit to expand beyond its global customer base of about 20 million users.
Per Coinbase’s earlier funding rounds, The Street reported that the firm pulled some $537.4 million from early-stage private investors. The exchange attained an $8 billion valuation after a $300 million funding round in 2018. Per the plans to go public, the firm is valued at $100 billion.
