Coinbase expected to value $100 billion, fueled by crypto hype

San Fransisco-based cryptocurrency exchange Coinbase Global Inc is expected to go public, valued at about $100 billion, on Wednesday, Bloomberg reported. The valuation would be more than the New York Stock Exchange, and Nasdaq Stock Market combined.

In March, the cryptocurrency exchange said in a regulatory filing that its private market securities sold at a weighted average price of $343.58 per share in the first quarter of 2021 through March 15, up from $28.83 per share in the third quarter ended September 30. This jump in private market trade price set Coinbase’s valuation at $68 billion.

A week before going public, Coinbase said it expects to report a profit of $730 million to $800 million in the first quarter, which is more than double its 2020 full-year profit, according to Bloomberg estimation.

“Coinbase is one of the most prominent cryptocurrency exchanges in the world,” Mira Christanto, an analyst who covers the company for crypto analytics firm Messari, said in a research report. “The market has shown that investors are hungry for crypto exposure through equity markets.”

In the report, Messari mentioned Coinbase has 56 million verified users and adds about 13,000 new retail customers a day.

Coinbase was founded in 2012 by Brian Armstrong, a former technical product engineer at Airbnb, and Fred Ehrsam, a former Goldman Sachs’ currency trader. Bloomberg estimated that Brian owns a stake worth about $15 billion, and Fred owns about $2 billion in Coinbase.

Julie Chariell, a senior analyst at Bloomberg Intelligence for fintech and payments firms, said the opportunity for Coinbase is to capture the growing number of corporate customers buying Bitcoin for the future. Also, providing additional products such as custody services might mean Coinbase could look more like a bank than an exchange, turning it into a one-stop-shop for crypto assets, the report cited.

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