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Coinbase IPO: Review On Crypto Exchange Platform

Coinbase IPO: Review On Crypto Exchange Platform

Discover the Coinbase share price as well as our review of Coinbase, the world's leading cryptocurrency platform: key figures and cryptocurrency investment offers offered by the platform. We will then look at the Coinbase IPO and its financial results and ratios, and finally try to determine whether it may be worthwhile to invest in Coinbase stock on the stock market.

Cryptocurrencies, since December 2020, have seen their prices increase dramatically, constantly setting new records. If only one were to be retained, it would of course be the $ 60,000 mark recently crossed by Bitcoin, bringing the valuation of the crypto-currency market well beyond the $1 trillion mark, unprecedented. !

It was against this backdrop that Coinbase shares went public on April 14, at a price of $250 per share. With the stock hitting $428 in its first few minutes of trading, Coinbase's market cap briefly hit $100 billion.

This valuation level therefore makes Coinbase's IPO one of the most significant IPOs of 2021.

Coinbase IPO Review On Crypto Exchange Platform

Coinbase In Figures: 4 Key Figures Of The Cryptocurrency Exchange Platform

  • 56 M: 56 Million verified users.
  • + 100: the platform is present in more than 100 countries.
  • $335 billion: $335 billion in total volume traded on the platform.
  • $65 billion: $65 billion in market capitalization.

Coinbase: A Leader of Cryptocurrency Trading

The Coinbase platform was created in 2012 with the ambition of offering all of its customers simple, efficient and secure access to cryptocurrencies.

Two young Californian entrepreneurs are at the origin of Coinbase: Brian Armstrong and Fred Ehrsam.

The Coinbase platform is based on a vision of a globally open financial system, not controlled by any specific country or company. It is thus an excellent vehicle for economic freedom, innovation and equal opportunities on a global scale.

Less than 2 years after its creation, Coinbase already had one million subscribers. In 2018, they were 20 million and reach over 35 million today.

Another small revolution is the introduction of the Coinbase Card, which allows purchases to be made in partner stores and even cash withdrawals. The group says more than 8,000 brands already accept cryptocurrency transactions.

Coinbase's Offers To Buy And Sell Bitcoin And Other CryptoCurrencies

The mainstream cryptocurrency offerings offered by Coinbase.

The basic service enables the buying, selling and using of cryptocurrencies.

Crypto Wallet is the application that centralizes the entire cryptocurrency portfolio. It also allows the sending or receiving of crypto-currencies with its contacts

USD Coin
Also called stablecoin, this service offered by Coinbase allows customers to benefit from a cryptocurrency with a stable value over time at the rate of 1USD Coin = 1US $.

This is a concept based on earning small amounts of cryptocurrency obtained by learning about different topics related to this universe.

Coinbase cryptocurrency : The best exchange platform

Coinbase cryptocurrency bonus
Coinbase Sign Up Bonus: How To Claim
To get your $10 bonus in crypto to your Coinbase wallet,  follow the steps below (make sure to use the Coinbase referral above.)
  1. Visit Coinbase by Click To Claim Above
  2. Open a free coinbase account
  3. Verify your coinbase account: Confirm email and phone
  4. Add payment method: Use a bank account, paypal, card, or wire
  5. Complete identify verification
  6. Buy crypto : choose from Bitcoin and others 
  7. Done, you’ve successfully got $10 free cryptocurrency.

Coinbase offers two main cryptocurrency platforms .

Coinbase Prime
Coinbase Prime offers tailor-made solutions adapted to professionals and institutions such as stockbrokers, fintechs (financial technology companies), management companies (asset managers), hedge funds, sovereign funds, family offices, or even for certain individuals. wealthy.

Coinbase Pro
Coinbase Pro is a cryptocurrency trading platform for traders.

Other services offered by Coinbase

Coinbase Commerce
Whether it is the e-commerce or physical in-store payment, Coinbase Commerce offers integration and / or application solutions enabling cryptocurrency transactions between individuals and merchants around the world.

Coinbase Custody
Coinbase Custody is an autonomous depository with independent capitalization under the status of trustee (validated by US law) for institutions. Thus, clients' assets are in independent accounts. In simpler terms, they are not integrated into a "common pot" and in this sense cannot be used by the broker (in this case Coinbase), which helps protect customers in the event of default by the latter. .

Coinbase Ventures
Coinbase Ventures is the investment arm of the Coinbase group. It helps finance innovative start-ups in the crypto world.

To name just a few examples, Coinbase has helped fund start-ups Compound, BlockFi, Dharma, Etherscan, etc.

Note that the main source of income for Coinbase is related to commissions on transactions (called "fees" in English). Thus, the recent surge in the price of cryptocurrencies has allowed fintech to benefit from a significant increase in its commissions.

How To Invest In Cryptocurrency With Coinbase?

The first step is to create an account on the Coinbase platform. Once the account is funded, it is possible to buy, sell, or convert crypto currencies into monetary currencies such as € or $ for example, as well as to carry out transfers with the "crypto wallets" of your contacts. .

Coinbase charges commissions on certain transactions. This is how the company generates its income.

Trading in cryptocurrencies such as Bitcoin, Ethereum, Litecoin, as well as many other cryptocurrencies then becomes accessible on Coinbase (around 40 cryptocurrencies are currently tradable).

Coinbase IPO: Analysis Of The Introduction On The Exchange Of The Cryptocurrency Platform

The Coinbase share price gong rang on April 14 on the US Nasdaq market at an introductory price of $250 per share.

A major enthusiasm of investors, traders, individuals, and institutions was observed, with no less than 81 million shares traded during this first half-day of trading.

Market cap even hit $100 billion just 10 minutes after its launch, peaking at $428 per share.

At the close of trading, the share price was $328, which represents a capitalization of $65 billion.

Coinbase share price on the day of its IPO

Graphically, the first 10 minutes of Coinbase share trading indicate a + 69% rise from the IPO price of $250 as the Coinbase share price hit $424 (peaking at $428 in the highest intra-candle).

Coinbase stock fell 2 hours later to a low of $310, before retracing slightly higher, to $328.05 per share at the end of the Nasdaq session.

  Note: The Coinbase IPO that just took place is very special. 
This is the first time that a cryptocurrency exchange platform
has been floated on the stock market.

This Coinbase IPO could also pave the way for a new wave of IPOs of "exchange" type companies. To date, listed companies belonging to the cryptocurrency sector are more concerned with “mining1”. Mention may in particular be made of SHA-256 or even Bitmain and MicroBT.

By way of comparison, the Nasdaq company (at a market price of $157.44 per share at the end of the April 14 session) capitalizes $25.9 billion on the stock market. Coinbase therefore quotes for the moment 2.5 x the value of the American company in charge of the management of the Nasdaq stock markets!

Note: do not confuse the capitalization of the Nasdaq Inc group (ticker code NDAQ) with the market capitalization of all the companies that make up the Nasdaq stock index.

7 Key Coinbase Indicators

1. Significant revenue growth in 2020
Coinbase sees its revenue increase by + 136% between 2019 and 2020, from $483 million to $ 1,141 million.

2. A beneficiary year 2020
The group makes a profit of $108.3 million in 2020, compared to a loss of $30.4 million in 2019.

3. A good solvency ratio
The solvency ratio of the Coinbase group, determined by the formula (financial debt / equity), comes out at 0.28, which is excellent.

4. Limited equity
With a market capitalization corresponding on its first day of trading at 67 times its equity (net assets valued at $963.6 million as of December 31, 2020), the Coinbase company appears to be overvalued.

5. A balance sheet size close to $ 6 billion
As of December 31, 2020, Coinbase's total assets are $5,855 million, of which $1,061 million is cash.

6. A leadership position
Coinbase is positioned as the world's leading cryptocurrency platform according to CNBC.

7. Dazzling growth in the first quarter of 2021
The official form (8-K) filed by Coinbase on April 6, 2021 shows these earnings estimates for Q1 2021:

  • an estimated turnover of $1.8 billion;
  • an operating margin, before depreciation and taxes, estimated at $1.1 billion;
  • a net profit of between $730 million and $800 million.

This growth is remarkable because the turnover and profits are higher than those of the year 2020 during the first quarter of 2021 alone.

Should You Invest In The Coinbase Share On The Stock Market?

At first glance, it may seem clearly unreasonable to invest on the stock market in a company valued 57 times its 2020 turnover, 67 times its net assets on the balance sheet (shareholders' equity), and above all, 600 times its 2020 net profit!

However, it is possible with these types of fintech companies to observe remarkable growth in results.

We still consider that advanced expertise is necessary before investing in Coinbase shares, especially in cryptocurrency since the growth of Coinbase is strongly linked to the evolution of the price of Bitcoin and other cryptocurrencies.

It is therefore particularly complex to make a recommendation on value, just as it was the same in the early days of Facebook or even Google, for example, two companies having yet been ranked among the largest companies in the world. However, an investor interested in Coinbase stock should be aware that there is a risk associated with the valuation of cryptocurrencies.

Coinbase is the world's leading cryptocurrency platform, so its future success will depend on the success (or not) of the world of cryptocurrencies.

How To Purchase A Coinbase Share?

The majority of online brokers provide access to Nasdaq shares and therefore allow trading of Coinbase shares.

But it is also possible to invest in the Coinbase bond from a securities account opened in an online bank or a network bank that gives access to the American markets. Please note that we remind you that online brokers and online banks generally have far more attractive pricing than traditional banking entities.