Coinbase Direct Listing a Milestone: Analysts

Share Article
In Brief
  • Excitement over Coinbase’s direct listing increases.

  • Listing is expected to be a “Amazon moment” for cryptocurrencies.

  • Bitcoin performance bodes well for listing price.

  • promo

    Want to learn how to trade? Get a beginners guide from _BeInCrypto Academy_ now!

The Trust Project is an international consortium of news organizations building standards of transparency.

Coinbase’s upcoming direct listing will make it the first cryptocurrency exchange to go public. This listing has been described as an “Amazon moment” by analysts from D.A Davidson.



Coinbase, filed papers with the US Securities and Exchange Commission on Feb. 25, for the listing on the Nasdaq. 

The company’s valuation is set at $100 billion, based on its secondary market price at $373 a share. This would make it the biggest listing for a tech company since Facebook. 



Analyst Gil Luria from D.A Davidson told CNBC that with this listing the cryptocurrency market and stock market will become intertwined. 

“It’s going to become clear that crypto is a giant asset class with a Trillion Dollars, is very relevant to the future of the delivery of financial services, and Coinbase is going to present that moment to the marketplace,” said Lucia. 

Luria’s confidence in Coinbase’s success lies in its diversification. He explained that it’s diverse coin offerings means that investing in the exchange itself lessens the risk for the investor, in comparison to investing in one coin market like bitcoin. 

While Luria presented an encouraging outlook, he did note that the volatility of cryptocurrency markets is likely to play a role in the price of Coinbase stock. 

Bitcoin outshines Big Tech Stocks

The biggest tech stocks, Facebook, Apple, Amazon, Netflix, Google (FAANG) had a good run in 2020 but were no match for Bitcoin. The cryptocurrency outpaced the year-to-date returns of many of these big names, even Amazon. Overall, Bitcoin outperformed the S&P 500 by 1600%  in 2020, according to data from Forbes.  

This bodes well for Coinbase’s stock market entrance. Not only is it coming onto the market with significant hype and a great reputation, but the performance by Bitcoin and cryptocurrency pumps could also translate into impressive stock performance. Since Coinbase is a company invested in the trade of Bitcoin, positive movements in this trade reflect well on the company and public confidence in it. 

However, on the flip side, this could mean that it also is linked to crypto markets volatility. This could make its price vary more than its tech company counterparts.

While FAANG has to worry about poor returns and public scandals shaking confidence in their performance, Coinbase has a myriad of cryptocurrencies to concern themselves with as well. Major crashes in the Bitcoin price or stumbling blocks like regulatory pushback would likely reflect its stock price. 

Disclaimer

All the information contained on our website is published in good faith and for general information purposes only. Any action the reader takes upon the information found on our website is strictly at their own risk.
Share Article

Anirudh works in the financial markets along with being a cryptocurrency and blockchain enthusiast. Apart from work, he is a music connoisseur and likes to play the drums.

Follow Author

Trade with the Best Crypto Signals - guaranteed profits with over 70% accuracy

Join now

Want to learn how to trade? Get a beginners guide from BeInCrypto Academy!

Learn now