Archive for the ‘IPO’ Category

Coinbase is About to Make History

Posted on: April 14th, 2021 by jms No Comments

Photo by Pierre Borthiry on Unsplash
Photo by Pierre Borthiry on Unsplash

 

Coinbase, the popular American cryptocurrency exchange platform, is about to make history with the largest IPO ever. Expected to open at $250 per share, Coinbase (ticker COIN) will be valued at $65 billion.

 

With the price of Bitcoin, and pretty much all other cryptocurrencies (unfortunately including Dogecoin) reaching all time highs, you might think this is the biggest news in the crypto-market world, but you’d be wrong. Coinbase is the most popular platform in the world for trading cryptocurrencies, and no matter how high or how low the price of Bitcoin is, Coinbase will continue to earn income and grow as long as crypto markets exist. Coinbase doesn’t need the price of Bitcoin to be over $60,000 to earn billions in transaction fees. The transaction fees, along with many of its other product offerings, like USD Coin, Coinbase Card, and Coinbase Commerce, will continue to earn Coinbase vast amounts of income even if the price of Bitcoin drops.

 

Think of Coinbase as the largest seller of shovels during the gold rush in the 1850’s. While everyone was digging for Gold, few got rich, but the biggest winners were those who capitalized on selling the best tools to help dig for gold. Coinbase is that company as it relates to helping investors enter into the crypto market with ease. It also has the right ecosystem for crypto commerce. So as cryptocurrency becomes more mainstream and eventually realizes what it was designed to do — buying and selling goods and services, Coinbase is already positioned as the top company to handle crypto commerce.

 

With Coinbase going public we all have the opportunity to own a part of the largest seller of shovels during this modern day gold rush. $250 per share is high, but the crypto market is still small. To put things into perspective, Coinbase currently handles roughly 300,000 transactions per day. In comparison, Amazon stock averages over 3 million trades per day, Visa handles over 150 million transactions per day, and over 6.4 billion stock trades occur each day.

 

Others have compared crypto market to the 1999 dot-com boom. At the top of the dot-com boom, there were about 250 million people online. Today, there’s about 5 billion people online. So there is still plenty of room for massive growth for the entire crypto market no matter how you look at it, especially since it’s still pretty far off from being mainstream. Think of Coinbase as one of those early dot-com companies that will not only last, but thrive, even if we are in another cryptocurrency bubble.