- Coinbase might be making its public debut this year
- A nod from the SEC will make Coinbase the first publicly traded crypto marketplace
- Coinbase will look at a direct listing as opposed to the traditional IPO
The current times have hardly sparked economic growth due to the global pandemic COVID-19 forcing various top tier companies to downsize causing job losses and revenue losses. However, digital asset exchange Coinbase might have a few plans which can make the company grow leaps and bounds.
An exclusive report by Reuters revealed that the firm might be looking at making a debut in the stock market anytime later this year.
Instead of an initial coin offering (IPO) the firm will take the route of a direct listing of its shares. Essentially a direct listing enables companies to trade publicly without putting a price on its equity which is the case in an IPO.
In order for Coinbase to do the listing, it would require a green light from the US watchdog Securities and Exchange Commission (SEC). Should it receive a go-ahead, it will become the very first publicly traded cryptocurrency exchange firm. Alongside this, approval will be a major milestone for the sector encouraging more crypto firms to get a mainstream endorsement.
The SEC has admitted that while cryptocurrencies can be considered as security, it has yet to develop a set of guidance and regulation on these virtual coins. This will also establish better trust between mainstream VCs who are wary of the sector and crypto firms.
Reuters added that while the firm has not expressed any intention to go public – either to stakeholders or the SEC – but “has been in talks to hire investment banks and law firms,” per sources who have chosen to be anonymous. After having contacted the firm, Reuters said that a Coinbase spokesman denied commenting on any rumors or speculation.
While it is a volatile market, it’s no secret that crypto is emerging as a growing sector. With more than 35 million users trading in a slew of virtual coins, including bitcoin, ethereum, and XRP, Coinbase has witnessed massive growth in the past few years. After the funding round in 2018, its market value rose to $8bn. Among other developments, the firm announced that it appointed ex-Facebook deputy general counsel Paul Grewal as its chief legal officer.
If the stock listing goes through, it’s won’t be surprising that more highly-valued cryptocurrency unicorns start gearing up for a run on the stock market.