fbpx

Coinbase Cryptocurrency Exchange Plans For Stock Market Listing, Could Be A First For The U.S.

Coinbase Cryptocurrency Exchange Plans For Stock Market Listing, Could Be A First For The U.S.

Coinbase
Coinbase, one of the best-known crypto exchanges in the world, has started making plans for a stock market listing. It could be a first for the U.S. Image by Autumn Keiko

Coinbase, one of the best-known cryptocurrency exchange platforms in the world, has started making plans for a stock market listing as soon as this year, which could make it the first major U.S. exchange to go public.

The Silicon Valley-based company has not yet registered its intent to go public with U.S. Securities and Exchange Commission. If the SEC signs off on it, it will represent a landmark victory for cryptocurrency advocates seeking mainstream endorsement, Reuters reported.

“If Coinbase is permitted to go ahead … the SEC will be acknowledging that cryptocurrencies are here to stay by allowing a company deeply involved with the industry to trade on a stock exchange,” Ashwath Balakrishnan wrote for CryptoBriefing.

Three sources spoke about the Coinbase plans on condition of anonymity because the listing preparations are confidential.

Founded in 2012, Coinbase has more than 35 million users who trade virtual coins including bitcoin, ethereum and XRP. The company was valued at more than $8 billion in its latest private fundraising round in 2018.

Coinbase announced on Wednesday that it had hired former Facebook vice president and deputy general counsel Paul Grewal as its chief legal officer. He was brought in to manage relations with financial regulators, possibly in preparation for going public, CoinTelegraph reported.

A source told Reuters that Coinbase is exploring going public via a direct listing instead of a traditional initial public offering (IPO). In a direct listing, a company does not sell new shares as it does in an IPO. Instead, investors and employees sell their existing Coinbase shares to the public, rather than the company issuing new shares. Existing investors are not bound by lock-up restrictions on when they can divest their holdings following the market debut.

“While raising additional capital is often associated with listing, existing (Coinbase) shares could simply be made available for trading with no additional funding,” according to CoinTelegraph.

Coinbase is funded by 55 investors, according to Crunchbase. Investors have included Andreessen Horowitz, the New York Stock Exchange, Manhattan Venture Partners, BBVA, Tiger Global Management, former Citigroup CEO Vikram Pandit and Fundamental Labs.

Coinbase, which allows traders to buy and sell bitcoin, was among the top beneficiaries of the 2017 bitcoin boom, which took bitcoin from $1,000 to almost $20,000, Reuters reported. Bitcoin is trading at almost $9,400.

Listen to GHOGH with Jamarlin Martin | Episode 73: Jamarlin Martin Jamarlin makes the case for why this is a multi-factor rebellion vs. just protests about George Floyd. He discusses the Democratic Party’s sneaky relationship with the police in cities and states under Dem control, and why Joe Biden is a cop and the Steve Jobs of mass incarceration.

Listing Coinbase on a significant U.S stock exchange could lead to more awareness and an improved public perception towards cryptocurrencies, Cryptobriefing reported.

Even though Wall Street institutions have started buying and selling bitcoin, the continuing growth of illegal transactions underscores the difficulties it has had in moving past its “reputation as a refuge for scoundrels,” The New York Times reported.

“Cryptocurrencies have time and time again tried to infiltrate the traditional financial marketplace with Bitcoin ETFs. But the SEC refused to budge, citing the risk involved with Bitcoin. Once again, the SEC remains a major obstacle to be overcome. Coinbase can only go public if the SEC allows it.”