Preparations Are Underway to Launch an Initial Public Offering on Coinbase
Coinbase applied with the US Securities and Exchange Commission. They estimate that the value of the operation is USD 28 billion.
In recent days, cryptocurrency trading platform Coinbase confidentially applied with the US Securities and Exchange Commission for its Initial Public Offering (IPO). They did not specify the volume of shares that they will be offering in the market, according to a brief note on their official blog.
According to some researchers, the exchange could have a value of around USD 28 billion.
Messari researcher Mira Christanto said that Coinbase estimates the high-end valuation to be at USD 32 billion, but they believe that USD 28 billion is a fair valuation. She added that that depends on market conditions and the continued positive momentum for crypto assets.
Coinbase is a company that offers exchange services between cryptocurrencies and fiat currencies such as the US dollar and the euro. They chose the Goldman Sachs firm to direct the operation that they conduct through the stock market.
When selecting the New York-based investment bank, the fact that its team members had made less than “bullish” comments on Bitcoin was irrelevant. Also, a report circulated in May in which there is an outline of why Bitcoin and other cryptocurrencies “are not an asset class.”
The firm also sent a memo to its customers saying that “Bitcoin does not represent a serious asset to gold status as a monetary commodity of last resort.”
Regardless of that, Goldman has been active in the crypto industry from the beginning, with investments in Circle, Bitgo, and other leading companies.
Experts in the field relate an Initial Public Offering (IPO) with an Initial Coin Offering (ICO), but there needs to be a differentiation.
An IPO consists of the sale of shares to investors for the first time, offering several advantages for the company, investors, and insurers (the investment bankers who make the initial public offering).
Regarding an ICO, it is a financing mechanism that allows a project or company to raise capital in highly liquid cryptocurrencies through the issuance of non-equity tokens.
Coinbase Token Shares
Public investors expect the San Francisco-based company to provide the details of the IPO. Meanwhile, cryptocurrency exchange FTX is working on a contract to trade token shares on Coinbase before the latter debuts on the stock market.
Sam Bankman-Fried, CEO of FTX, said that they will try to do it, but he was still not sure that they could.
FTX recently held a pre-IPO market for Airbnb before its launch on December 10th, 2020 on the stock market. The company managed to make the stock double in price and is trying to repeat the situation for Coinbase.
By Willmen Blanco
