Project Update: Coinbase launches COIN on Nasdaq

April 2021 may be remembered as a landmark month for cryptocurrency, with the flotation of Coinbase on Nasdaq exposing traditional investors to the sector. Until now many US traders would ignore the blockchain sector, but Coinbase has planted a flag on the hill for the entire industry, making it impossible to overlook any longer.

By
Robert D. Knight
on
April 27, 2021
Category:
Blockchain News


The Launch

Prior to COIN’s launch on Nasdaq, the impending flotation was felt elsewhere in the crypto market as BTC and BNB both surged to new ATHs of $64,800 and $610 respectively. Two weeks in, BTC has retraced significantly, now hovering around the $50,000 mark, while BNB has performed considerably better, only dropping to around $530. 


On the day of flotation, April 14th, shares of the newly listed COIN rose from an initial price point of $250 to $430, before tumbling down to $328. At time of writing, the price per share of COIN sits at the $300 mark, with the market capitalization of Coinbase resting around $58B. That is a significant figure, but still a little bit away from the valuation Coinbase set for itself at around $100B.

Effects of Launch

Although the initial flotation of COIN proved highly successfully, nearly $5 billion in COIN assets were dumped shortly after listing. Information from the Coinbase Investor Relations website showed that 12,965,079 shares were sold by insiders, a sum which was worth over $4.6 billion at COIN’s $344 share price at close on Friday.


Among the insiders dropping COIN onto the market was the Coinbase CEO, Brian Armstrong. Research from Reuters estimated that Armstrong moved 749,999 shares in three batches at a price range between $381 to $410.40 per share. This scooped the founder a cool $292 million. While major sell-offs could be used to infer that founders and insiders are already “cashing in” on the flotation, the main actors at Coinbase still hold a considerable stake in the firm. Armstrong’s sell off and $292 million pay day only represents 2% of his total shares in the company.


About Coinbase

Source


Coinbase is a cryptocurrency exchange with over 50 million current users. The team started Coinbase as a place for people to easily exchange Bitcoin, and have transitioned into offering easy access to the wider crypto economy that has developed in recent years. With over $220 billion Total Value Locked (TVL), Coinbase has made a name for itself as a reputable exchange that streamlines user experience. 

Future and Final Thoughts 

Since floating on Nasdaq, Coinbase has announced that it will also trade options. This will better enable traders to bet on the future value of COIN moving forward. Options grant traders the right to trade in a particular stock, but do not constitute an obligation to buy or to sell. Meanwhile, Coinbase users can enjoy the possibilities of greater numbers of trading pairs. Coinbase Pro has announced it will add new pairs for Basic Attention Token (BAT), Cardano (ADA), Decentraland (MANA), and USDC. All four assets will be paired with the fiat currencies USD, EUR and GBP as well as BTC and ETH. Options on COIN began from April 20th, with new trading pairs launching on the same day.

While the value of Coinbase has not yet reached the heights expected by the firm, early indicators remain positive. The listing may have caused some initial volatility in the cryptocurrency market, but conditions have since settled down. Total market capitalization of the sector now sits at $2.06T, down from $2.37T but up from the $1.87 trillion the market fell to just after the Coinbase listing.


For investment firms which were savvy enough to invest in Coinbase during its seed rounds - some of which bought shares at $1 a piece - there is no other way to look at the listing as anything other than a massive success story. The question remaining is whether more exchanges will look to the example set by Coinbase and seek to follow suit.

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Robert D. Knight

Robert D. Knight is an experienced journalist and copywriter who has been working in crypto for 4+ years. His bags are heavy and he also hodls some cryptocurrency.