July 9, 2020

Crypto marketplace Coinbase eyeing stock-market listing as early as this year

[Business Insider]

  • Cryptocurrency exchange Coinbase has started planning for a stock market listing that could take place as soon as this year, Reuters reported Thursday, citing sources familiar with the matter.
  • If the Securities and Exchange Commission signs off on the listing, Coinbase could become the first publicly traded cryptocurrency marketplace.
  • The company is eyeing a direct listing for its debut over a traditional initial public offering, sources told Reuters. 

Cryptocurrency marketplace Coinbase has started planning for a stock market debut to take place as soon as this year, Reuters reported Thursday.

The listing still needs approval from the Securities and Exchange Commission. Should the agency approve of the company’s plans, it would usher in the first stock market listing for a cryptocurrency marketplace and mark a major achievement for cryptocurrency investors.

Coinbase hasn’t yet logged its intention to go public with the SEC, but the company has been speaking to investment banks and law firms for its plans, the sources told Reuters.

The company’s most recent funding round in 2018 valued the firm at more than $8 billion. The company is more interested in going public through a direct listing than a traditional initial public offering, sources familiar with the plans told Reuters. Direct listings allow firms to go public without raising capital in a stock sale. Shareholders are able to sell their equity without having their stakes watered down by a new issuance.

The SEC has yet to establish many ground rules for digital tokens. The agency previously classified some coins as securities and said they could be regulated accordingly. The asset class’ lack of regulatory recognition has long scared investors away from the tokens.

The crypto market’s massive rally and subsequent meltdown in 2018 further intensified concerns around the volatile market. Most recently, a viral TikTok challenge urging viewers to buy Dogecoin revived commentary of the cryptocurrency market’s speculative nature.

By Ben Winck

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