Digital currency exchange Coinbase plans to go public

The digital currency exchange Coinbase (stock code: COIN) recently announced that it plans to list directly on the Nasdaq in the United States around April 14, 2021. Prior to this, Spotify, Slack, Asana and Palantir, etc., all adopted the “direct listing” model, and the listing location was the New York Stock Exchange.

Coinbase will become the world’s first publicly listed cryptocurrency exchange.

Coinbase is the largest cryptocurrency trading platform in the United States. In 2021, the price range for transactions in the private equity market is US$200 to US$375, and the average transaction price from January to March 15 is US$343.58.

According to the calculation of the latest total outstanding equity, Coinbase is valued at 67.6 billion U.S. dollars, and the highest value previously reached 90 billion U.S. dollars.

Annual profit exceeds 300 million U.S. dollars

Coinbase was founded in 2012, and it claims that the idea at the beginning of its creation was to allow everyone to send and receive bitcoins easily and securely anywhere.

Most of the users’ assets on the Coinbase platform are Bitcoin, accounting for 70%, followed by Ethereum; Ethereum accounted for 9% of the Coinbase platform in 2019, and it will increase to 13% in 2020;

The proportion of other digital currencies dropped from 15% in 2019 to 13% in 2020, and the proportion of fiat currencies dropped from 6% in 2019 to 4% in 2020.

Most of Coinbase’s revenue comes from transaction fees, and performance is highly correlated with transaction activity on the platform.

Due to the surge in Bitcoin, the number of authenticated individual users on the Coinbase platform continues to increase, reaching 23 million in the first quarter of 2018 and reaching 43 million in the fourth quarter of 2020.

Coinbase’s retail transaction volume in the fourth quarter of 2020 was $32 billion, and its institutional transaction volume in the fourth quarter of 2020 was $57 billion.

The prospectus shows that Coinbase’s revenue in 2019 and 2020 will be 534 million U.S. dollars and 1.277 billion U.S. dollars, respectively; operating profits will be -45.78 million U.S. dollars and 409 million U.S. dollars; net profit will be -30.39 million U.S. dollars and 322 million U.S. dollars respectively.

About 85.8% of Coinbase’s revenue comes from customer transaction fees; about 3.5% of revenue comes from subscription and service income, mainly asset custody fees paid by customers; about 10.6% of revenue comes from other income.

Among them, Coinbase’s revenue in the fourth quarter of 2020 was US$585 million, compared with US$98.27 million in the same period last year and US$315 million in the previous quarter. Coinbase’s net profit in the fourth quarter of 2020 was US$177 million, compared with a net loss of US$27.87 million in the same period last year and a net profit of US$81.3 million in the previous quarter. Coinbase’s adjusted EBIDA in the fourth quarter of 2020 was US$287 million, the adjusted EBIDA of the previous quarter was US$123 million, and the adjusted EBIDA of the same period last year was US$-17.55 million. Coinbase pointed out that performance growth mainly depends on digital asset prices and fluctuations, increasing support for new currencies, providing more products and services, expanding investment, making prices more competitive, controlling transaction costs, strategic mergers and investment cooperation, the United States and international Market regulations and other aspects.

Brian Armstrong has the most voting rights

According to reports, Coinbase founder Brian Armstrong graduated from Rice University in 2005 with a bachelor’s degree in computer science and economics and later worked at Airbnb as a software engineer. At Christmas 2010, Armstrong accidentally read Satoshi Nakamoto’s Bitcoin white paper and began to participate in a Bitcoin meeting in San Francisco. On weekends and holidays, Armstrong began designing prototypes and writing code. This project later received $150,000 from the startup incubator Y Combinator, which became a catalyst for Armstrong to quit his job at Airbnb, laying the foundation for the later establishment of Coinbase Spark Global Limited.


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