An expected public offering from Coinbase Global Inc. appears close after the cryptocurrency trading platform filed proceedings with the Securities and Exchange Commission on Thursday.
Coinbase COIN,
plans to trade on the Nasdaq Stock Exchange Inc. of NDAQ,
under the “COIN” symbol, with the goal of using a non-traditional direct list to make itself public. This method means that it will not raise new money, similar to the approaches used by Palantir Technologies PLTR,
Slack Technologies WORKS,
and Spotify Technology SPOT,
in recent years.
This is what you need to know about the popular trading platform before its public offering.
What is Coinbase?
The Silicon Valley cryptocurrency exchange was co-founded in 2012 by Brian Armstrong, 38, who heads the platform’s chief executive. Fred Ehrsam, director of Coinbase, also helped create the company.
There are two classes of Coinbase shares. Armstrong owns 11% of the Class A shares and 22% of the Class B shares, while Ehrsam owns 11.4% of the Class A shares and 9% of the Class A shares. class B.
According to Forbes, Armstrong’s networth is currently $ 6.5 billion depending on his ownership of the business, which is likely to increase if the direct listing is successfully achieved.
Coinbase is proposed as a bet on the growing cryptoeconomy, which begins with bitcoin’s No. 1 cryptocurrency asset, but goes much further, according to Armstrong and company.
Coinbase S-1
Bitcoin BTCUSD Prices,
they have gained attention as they have skyrocketed to repeated records, most recently hitting a recent peak above $ 58,000 over the weekend before starting to give up some gains in recent trade.
Last week, Bitcoin reached a market value of $ 1 trillion, and while the asset created by a person or people known as Satoshi Nakamoto accounts for approximately 70% of the total cryptocurrency market, there is still a series of other popular cryptocurrency assets listed on Coinbase, including ETHUSD ether,
in the Ethereum blockchain, Bitcoin Cash BCHUSD,
and Litecoin LTCUSD,
to name a few.
Who else owns Coinbase?
Venture capital company Andreessen Horowitz is the largest owner of Coinbase, with 25% of Class A shares and 14% of Class B. And Marc Andreessen, head of the venture capital team, is sits on the board of Coinbase.
Coinbase has the ambitions of Robinhood Markets
“Coinbase is a company with an ambitious vision: to create more economic freedom for all people and businesses,” Armstrong wrote in a letter attached to the company’s public filing procedures with the SEC.
Greater risk factor
Undoubtedly, Coinbase’s biggest risk factor is that it is betting on an unproven asset class that was created just over a decade ago. Coinbase tries to make it clear that its fate is related to the prospects of Bitcoin and ethereum and the thousands of other alternative currencies that have been created.
But a drop in interest rates and tough regulations in the United States and elsewhere could upset the exchange platform.
Coinbase then explains:
“There is no guarantee that any supported cryptographic assets will maintain their value or that there will be significant levels of commercial activity. In the event that the price of cryptographic assets or the trading demand of cryptographic assets decreases, our business, operating results and financial situation would be adversely affected. Most of our net income comes from transactions with Bitcoin and ethereum. If demand for these cryptographic assets decreases and is not replaced by new demand for cryptographic assets, our business, operating results and financial condition could be adversely affected.“, Coinbase writes in its S-1 presentation.
How big is Coinbase?
According to data site CoinMarketCap.com, the cryptographic exchange platform ranks number 3 among the largest digital asset exchanges in the world. This ranking places it behind Binance, based in Seattle and Huobi Global, a Seychelles-based cryptocurrency exchange based in China.
CoinMarketCap.com
In the United States, Coinbase is by far the best-known cryptocurrency platform, but there are competitors, including Gemini, led by Tyler and Cameron Winklevoss, who used their Facebook Inc. FB.
settlements to invest in bitcoins.
Kraken is another popular cryptography platform and a direct competitor in the US
Probabilities and endings
In its public presentation, the company offered several tributes to the founder or founders of bitcoin and the era of digital currency.
For example, he listed the genesis block associated with Satoshi Nakamoto in “1A1zP1eP5QGefi2DMPTfTL5SLmv7DivfNa,” whose white paper launched bitcoin in 2008. In addition, a “Satoshi” is the smallest unit of bitcoin: 0.00000001 BTC).
The company does not provide any physical address for its headquarters in California, citing the COVID-19 pandemic, which has forced several companies to have the majority, if not all, of their remote workers. For this reason, Coinbase refers to itself as a “remote company”.
However, having no address to some was considered to align with the decentralized nature of blockchain and bitcoins.
The company also offered a handy manual on cryptocurrency terms, including definitive terms like “hodl,” which have become popular in cryptocurrency circles. Hodl was accidentally minted on a 2013 Reddit and means having a long-term investment.
Read: Don’t fight the FUD: HODL in this list of bitcoin terms you need in your vocabulary
SEC
Armstrong crypto charity
In 2018, Armstrong started GiveCrypto.org, which makes direct cash transfers to people living in poverty.
“People who invested early in cryptography have amassed a great deal of wealth in a relatively short time. However, the reputation of the cryptographic community has been dominated by images of ‘bros in Lambos,’ whose jokes call a lot of attention, ”Armstrong wrote in an independent blog post in Medium in 2018.
Armstrong reportedly donated at least $ 1 million to GiveCrypto.