Coinbase has made its IPO on the Nasdaq official by submitting the so-called Form S-1 to the SEC.
The announcement states that shares of Class A common stock will be offered for sale by existing shareholders and listed on the Nasdaq Global Select market.
Unlike a classic Initial Public Offering (IPO), the sale of shares by existing shareholders is not underwritten by any investment bank, and the company’s existing shareholders will be able to choose to sell their Class A common shares on the Nasdaq Global Select Market however and whenever they wish.
This is therefore not a classic issuance of new shares to raise money, but simply a concession to existing shareholders to be able to monetize the shares they hold.
Each Class A ordinary share also carries the right to one vote, so those who buy them will then be able to exercise this right at shareholders’ meetings.
Until now, there was no public market for these shares, which could only be traded in private transactions, while now they will be tradable on the Nasdaq.
The numbers of the Coinbase IPO
A few days ago, a long prospectus about the Coinbase IPO was published on the Nasdaq website, in order to inform potential buyers about the nature of the company and the placement of its shares on the stock exchange.
The symbol under which Coinbase’s shares will be traded on the Nasdaq will be COIN, but the exact start date of trading is not yet known.
In 2020, the company reported revenue of $1.3 billion, with a net profit margin of 25%, although half of that came only in the last four months.
In 2018, the company’s total value was valued at $8bn, while recently the valuation has risen to around $77bn. The valuation is assumed to be around $100 billion at the start of the IPO on Nasdaq.
The company’s co-founder and CEO, Brian Armstrong, currently owns 21% of Coinbase’s shares, and if the company’s valuation reaches $100 billion, his stake would be worth around $21 billion.