On Thursday (December 17), COINBASE Global, Inc. signalled its intention to conduct a registered public offering by announcing that it had filed a registration statement with the U.S. Securities and Exchange Commission.
Here is what Coinbase said in its brief blog post:
“Coinbase Global, Inc. today announced that it has confidentially submitted a draft registration statement on Form S-1 with the Securities and Exchange Commission (the ‘SEC’). The Form S-1 is expected to become effective after the SEC completes its review process, subject to market and other conditions.”
This means that Coinbase wants to go public, i.e. conduct its initial public offering (IPO) by selling shares of its stock to the public.
Before companies can start offering securities to the public, the SEC requires that they “disclose important financial information through the registration of securities,” which means that they must file a registration statement, and they are unable to sell the securities mentioned in the registration statement until the SEC staff says that the registration statement has become “effective.”
According to the SEC, here are some examples of information that a company needs to provide in the registration forms it files with the SEC:
- “A description of the company’s properties and business”
- “A description of the security to be offered for sale”
- “Information about the management of the company”
- “Financial statements certified by independent accountants”
Earlier today, Mira Christanto, Asia Advisor at Messari, said in a Twitter thread that Messari’s analysis of Coinbase’s business values the company at $28 billion:
Following Coinbase's IPO announcement, we value the company at $28 billion. Coinbase is one of the most prominent exchanges with $1 billion daily volume in Dec-20.
Check out our model and edit it to your own assumptions. https://t.co/BQeSAxUd5j
— Mira Christanto (@asiahodl) December 18, 2020
Larry Cermak, Director of Research at The Block, made the interesting observation that “the same day Coinbase filed confidential S-1 ahead of IPO, Coinbase also had the second highest daily volume in existence.”
This is almost poetic. The same day Coinbase filed confidential S-1 ahead of IPO, Coinbase also had the second highest daily volume in existence. The timing couldn't be better. The highest day on Dec 22, 2017 with $3.36B and yesterday the second highest with $2.92B pic.twitter.com/foSjsgswDm
— Larry Cermak (@lawmaster) December 18, 2020
Ryan Watkins, Senior Research Analyst at Messari, explained why he believes that the upcoming Coinbase IPO “will draw an incredible amount of interest.”
This this offering will draw an incredible amount of interest.
Imagine there’s many institutional investors that see the writing on the wall that cryptocurrency is real, but still want a more familiar way to play it – i.e buy the picks and shovels https://t.co/6NJV3mfzCv
— Ryan Watkins (@RyanWatkins_) December 17, 2020
And Barry Silbert, Founder and CEO of Digital Currency Group (DCG), believes that Coinbase’s IPO will increase the valuations of quite a few other crypto companies.
Thanks to the Coinbase IPO, the acquisition price of a bunch of crypto companies is about to go way way higher
— Barry Silbert (@BarrySilbert) December 17, 2020