Coinbase IPO - a boost for crypto?
Hi,
you may have heard that we will have a new COIN in two days. I'm not speaking of a new crypto but about a crypto related stock, namely COIN which stands for Coinbase, the crypto exchange.
The USA based exchange, has picked a very good moment for listing as we are in a strong bull market, where people rush to spend the newly printed fiat on crypto, and where can do it as fastest and uncomplicated? Of course on an exchange.
Both 2020 and 2021 have been good to Coinbase, and it is listing is coming when the company shows high profits, which come from trade and deposit/withdrawal fees.
If they had listed in 2019, it would have looked different, as they have been losing a big amount of money, but now, where people trade and buy crypto in a frenzy, it is the sweet moment to do the listing.
Some people expect that the IPO will be a gold rush, and see a 10x in first days as realistic. I'm participating also in the IPO, where I expect an increase, but would not bet on 10x. It would be unrealistic as they have the profit module fixed on fees, which are high.
Will this business model work? Definitely as long as fiat is printed in masses. We see a strong trend that will not stop, where fiat will be continued to be printed, to cover mistakes by the government and this money gets into asset classes and crypto is one of the asset classes with the highest traction at the moment, even if only a small part of the population is taking part in the crypto(r)evolution.
There are also small risks, that this IPO will fail, as some analysts say it is an overpriced business model. As I'm not a financial analyst, this would be not a piece of advice. As from my personal point of view, I see it as fuel for crypto. People associate Coinbase with crypto and if the IPO will skyrocket, crypto will get some turbo fuel.
In the worst case, a failed IPO will create some pressure on crypto, but not that high to destabilize it. It will scare off some people, for sure, especially the ones not initiated in the art of crypto, but we all know, that Coinbase is not crypt, it is only an expensive gateway to it.
How do you see the listing of COIN? Will it impact crypto? Why?
Posted Using LeoFinance Beta
The danger for crypto is that increasing ties between Wall Street and crypto will increase demands that the SEC regulate crypto as a security.
Notably, the calls to regulate RIPPLE was based largely on RIPPLES tie to Wall Street markets.
Posted Using LeoFinance Beta
I don't think it will fail, but I also don't think it will take much for the price to fall down into a more reasonable level after the initial influx. I am hoping I can pick up a couple of shares at a sub $400 price point. Right now the $440 per share they are projecting is just too much for my sparse budget.
Posted Using LeoFinance Beta
I think this will be valued high - and stay high. Trading fees galore, no competition, first to market - and about the only fiat to crypto on ramp right now. As we get more adoption - more money will start to flow!
Posted Using LeoFinance Beta
Considering they want Coinbase to sell each share at $200 a stock, I don't think I want to buy any. I don't know whether it is good or bad but it will at least legitimize crypto in the eyes of the traditional investor.
Posted Using LeoFinance Beta
Well, I guess institutional investors will feel even more at ease to buy crypto via Coinbase, after it becomes public and in the hands of traditional investors, probably.
Posted Using LeoFinance Beta