Cryptocurrency exchange Coinbase announced on Thursday that it would begin trading on April 14 after receiving the green light from the Securities and Exchange Commission. If everything goes well, the San Francisco-based company, ranked No. 10 on the 2018 CNBC Disruptor 50 list, will become the first crypto exchange to go public in the United States.
The company stated that it anticipates going public with a direct stock listing in two weeks. But first, it must receive regulatory clearance for its direct listing from the SEC.
Coinbase recently published a short blog post announcing the SEC’s approval. Other companies, such as Spotify, Roblox, Palantir, and Slack previously went public through direct listings on the New York Stock Exchange. However, Coinbase will be the Nasdaq composite’s first major direct listing.
What are Coinbase plans?
Coinbase has stated that it wants to register almost 115 million shares of Class A common stock. They will trade under the ticker symbol COIN. In a direct listing, the issuing company typically forgoes selling new stock. This allows existing stakeholders to sell their shares to new investors instead.
The SEC’s decision to give the green light to Coinbase marks a milestone for crypto advocates. It seems digital coins are slowly gaining leverage. Many traditional banks and institutional investors have recently embraced crypto while previously deemed too speculative and volatile.
Despite such cautions and suspicions swirling around it, Bitcoin skyrocketed by about 800% in the past year. Consequently, Coinbase, an ecosystem of trading platforms and infrastructure companies emerging around Bitcoin, has rallied in value as a proxy for the broader crypto-economy.
Coinbase claims to have more than 43 million users trading digital assets in more than 100 countries. However, the company listed potential price declines in Bitcoin as one of the risk factors in its prospectus.
Nevertheless, it had reached an implied $68 billion private market valuation last month. Private market value is less indicative of a company’s share worth, but the Nasdaq will still use that information to set a reference price ahead of Coinbase’s direct listing.