Not many knew about Coinbase a year ago. Today it is one of the great protagonists of the world economic panorama, and it is thanks to a historic IPO with a valuation that has finally skyrocketed to nearly $ 100 billion.
That figure contrasts with the 8,000 million in which the company was valued after its last investment round in 2018. Its IPO could not have occurred at a better time: bitcoin is at all-time highs and carries contagious optimism for some cryptocurrencies that have been conquering the institutional market for months.
Coinbase has debuted at $ 381 per share. Over the last few hours, the stock has risen to $ 429 and at the time of this writing it is around $ 320.
If Coinbase had to go public, there was no better time than this
After various rumors of the possible value of the shares, The Nasdaq set its benchmark value at $ 250 per share, which was equivalent to an initial valuation of $ 65.3 billion.
Before that Coinbase had indicated that based on private market transactions its market value was at $ 68,000, when in September 2020 it was at 5.8 billion.
The staggering growth in that valuation is a direct consequence of the new golden age of cryptocurrencies, which have ended up convincing financial institutions and private companies that like Tesla even decide to use bitcoin as a store of value that for many is capable of replacing traditional gold in this role.
Coinbase’s IPO comes at an ideal time: the cryptocurrency market is currently breaking records, and indeed bitcoin managed in the last hours to exceed 64,000 dollars of value, when a year ago its value was $ 6,700.
Clear optimism, but cautionary arguments for investors
Experts believe that Coinbase’s IPO is the ultimate test of cryptocurrency maturity. From that concept of bitcoin something esoteric and supported by crypto believers (and the one who denied the financial world) we now turn to a bitcoin accepted by institutions of all kinds and that little by little is becoming a serious future alternative.
That is not to say that there are no doubts about the future of cryptocurrencies in general and that of Coinbase in particular. Regulation in this segment is still somewhat diffuse and depends on an absolutely volatile market like cryptocurrencies.
For experts like Larry Cermak, from The Block, “the correlation with bitcoin will be very high when the stock stabilizes after going public. When the price of bitcoin falls, it is inevitable that the income and inherent price of the Coinbase share will also fall.“.
The company itself warned about this in the report sent to the SEC (Securities and Exchange Commission) with which they formalized this IPO. His business, he claimed, “depends substantially on the price of crypto assets and the volume of transactions made on our platform “.
Coinbase’s role might also not be in the near future what it is now. East exchange or market for the sale of cryptocurrencies It is now a clear reference in these transactions, but that could change.
In fact, this centralized model that has Coinbase and other exchanges as mandatory intermediaries (what banks and brokers did in the traditional financial market) has signs of changing in the future.
The world of decentralized finance (DeFi, by Decentralized Finance) is starting to gain popularity among many investors who see how exchanges like Uniswap or Sushiswap can come up with an alternative that will remove players like Coinbase from the equation in the future.