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Coinbase to Sell Stock on Private Markets Ahead of IPO: Reports


decrypt.co 25 January 2021 11:10, UTC
Reading time: ~2 m

Coinbase will launch a secondary market for its private stock on the Nasdaq, according to reports.

The exchange reportedly informed shareholders that they would receive further details about the launch on Monday, The Block reported today. 

It is not yet clear how the market will function—shareholders will know next week—but The Block said that current and ex-employees will likely be able to sell shares. 

Coinbase, the largest crypto exchange in the US, in December filed a registration for an Initial Public Offering (IPO) to the US Securities and Exchange Commission (SEC).

IPOs give people the chance to have a stake in a corporation. The idea is that new investors will be drawn to Coinbase and the wider crypto industry, and be able to buy and sell shares in the company. 

Just released: Our Year in Review covers 2020 from the lens of our institutional clients, including insights on optimal allocation and the story behind our largest trades to date. https://t.co/JoGK5msEaP

— Coinbase Institutional (@CoinbaseInsto) January 22, 2021

Coinbase hopes that the upcoming IPO would raise money so they can expand their business. As it will be regulated by the SEC, it is likely more institutional investors who were perhaps previously cautious about getting involved in the crypto industry will get involved.

But it still isn’t clear when the IPO will launch.  

How is Coinbase doing?

Coinbase has had a good past 12 months. The exchange said in its year-end report that it now has $90 billion in digital assets on its platform.  

Coinbase Review: A Great Jumping-On Point For Bitcoin Beginners

The company has embraced regulation and tried its best to get in the good books of lawmakers: most privacy coins (usually associated with crime) aren’t available on the platform and it has a strict Know Your Customer (KYC) policy.  

In December 2020, crypto market analysis firm Messari valued the exchange at $28 billion.

But will that be enough to convince the SEC to let it hold an IPO? 

The views and opinions expressed by the author are for informational purposes only and do not constitute financial, investment, or other advice.

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