Coinbase goes public in Nasdaq, closes at $85.8 billion

The San Francisco-based startup Coinbase allows people to buy and sell digital currencies. When it debuted on the stock market on Wednesday, it became the first major cryptocurrency company to issue shares publicly.

Founded in 2012, Coinbase aims to simplify buying Bitcoin and has become the most popular cryptocurrency exchange in the U.S. Its value has soared along with the digital currencies Bitcoin and Ethereum. The service currently has 56 million users, up from 43 million at the end of 2020. In the last round of private financing in 2018, investors valued Coinbase at $8 billion.

Coinbase entered the open market due to the large record influx of cash into cryptocurrencies. Snowflake, Palantir, DoorDash, Airbnb, and Roblox have all gone public in the past six months. Their market value ranges from $45 billion to $106 billion.

Coinbase stock closes at $328.28 in Nasdaq debut

Coinbase stock closed at $328.28 per share when it debuted on the Nasdaq on Wednesday. On a fully diluted basis, the initial market value of this cryptocurrency exchange was $85.8 billion.

The stock opened at 381 US dollars. Once the price soared rapidly to 429.54 US dollars, it then fell below the initial public offering price. Lastly, the price fell to a low of about 310 US dollars. The price is still well above the reference price of $250 set on Tuesday night. Still, no stocks have changed hands at that price.

Coinbase directly listed its shares through the traditional IPO process. It allows employees and existing shareholders to sell their shares at market prices. Coinbase followed technology companies such as Spotify, Slack, Palantir, and Roblox. It helped to standardize the process of seeking a direct listing.

The company announced its preliminary results for the first quarter last week. Its revenue during the period increased nine times from the same period the previous year to US$1.8 billion, and its net income climbed from US$32 million to between US$730 million and US$800 million. The number of monthly transaction users (MTU) increased to 6.1 million from 2.8 million three months ago.

By 2020, revenue has more than doubled to reach 1.28 billion U.S. dollars, and the company has turned from a loss in 2019 to a profit of 322.3 million U.S. dollars.

Most transactions on Coinbase involve buying Bitcoin or Ethereum. The company stated that its short-term performance would be determined mainly by cryptocurrency prices.