Coinbase Announced It Will Go Public, But Didn't Give Details
Coinbase was founded in 2012 as a simple way for consumers to purchase Bitcoin, but has grown into a conglomerate of crypto-related business (diversifying its revenue model beyond trading fees). The company hopes to take advantage of the noise around bitcoin hitting all time highs and the surging trading volumes to boost their price (Coinbase makes the bulk of its revenue from trading commissions). The company’s last fundraising round of $300 million from 2018, valued it near $8 billion.
Coinbase did not provide details about how it would structure its offering. In the past Coinbase cofounder, Fred Ehrsam , has said he intends to go public via an offering involving digital tokens on a blockchain. However, the Securities and Exchange Commission might not sign off on such an arrangement. One realistic option would be for Coinbase to pursue a direct listing in which it sells shares directly to the public (a model recently used by Spotify and Slack). Coinbase’s IPO will give early shareholders including CEO Brian Armstrong and venture firm Andreessen Horowitz a chance to cash out.
When Coinbase launched, many dismissed Bitcoin as a fad, but today a new crypto fund run by cofounder Ehrsam has attracted investments from the likes of the endowments of Harvard and Stanford universities.
Coinbase recently elevated Marc Andreessen to full board member status and added Cisco CFO Kelly Kramer a sign they are already laying groundwork for the IPO.