By Mark DeCambre
A long-awaited public offering of Coinbase Global Inc. appears near after the cryptocurrency trading platform filed paperwork with the Securities and Exchange Commission on Thursday.
Coinbase /zigman2/quotes/225893452/composite COIN +5.96% plans to list on the Nasdaq Inc. exchange /zigman2/quotes/205547889/composite NDAQ +0.07% under the ticker symbol “COIN,” with the aim of employing a nontraditional direct listing to take itself public as soon as next month. A direct listing means it won’t raise any new money, similar to approaches used by Palantir Technologies /zigman2/quotes/221054928/composite PLTR -2.94% , Slack Technologies /zigman2/quotes/212180539/composite WORK +0.48% and Spotify Technology /zigman2/quotes/207488629/composite SPOT -2.58% in recent years.
Here’s what to know about the popular trading platform ahead of its public offering.
What is Coinbase?
The Silicon Valley crypto exchange was co-founded in 2012 by Brian Armstrong, 38, who runs the platform chief executive. Fred Ehrsam, a Coinbase director, also helped to create the company.
There are two class of Coinbase shares. Armstrong owns 11% of the Class A shares and 22% of the Class B shares, while Ehrsam owns 11.4% of the Class A and 9% of the Class B.
According to Forbes , Armstrong’s networth is currently $6.5 billion based on his ownership in the company, which is likely to increase if the direct listing goes off successfully.
Coinbase bills itself as a bet on the rapidly growing cryptoeconomy, which starts with the No. 1 crypto asset bitcoin but goes well beyond that, Armstrong and company argue.
Bitcoin prices /zigman2/quotes/31322028/realtime BTCUSD -2.63% have gained attention as it has soared to repeated records, most recently touching a recent peak above $58,000 over the weekend before beginning to give up some gains in recent trade.
Last week, bitcoin hit a market value of $1 trillion and even though the asset created by a person or persons known as Satoshi Nakamoto represents about 70% of the total crypto market, there are still a number of other popular crypto assets trading on Coinbase, including ether /zigman2/quotes/108573964/realtime ETHUSD -4.21% on Ethereum’s blockchain, Bitcoin Cash /zigman2/quotes/108573970/realtime BCHUSD -2.77% and Litecoin /zigman2/quotes/108573968/realtime LTCUSD -1.14% , to name a few.
Who else owns Coinbase?
Venture-capital firm Andreessen Horowitz, is the largest owner of Coinbase, boasting about 25% of Class A shares and14% of Class B. And Marc Andreessen, head of the venture capital outfit, sits on Coinbase’s board.
Coinbase has an ambitions echo those of Robinhood Markets
“Coinbase is company with an ambitious vision: to create more economic freedom for every person and business,” Armstrong wrote in a letter appended to the company’s public-filing paperwork with the SEC.
Biggest risk factor
No doubt the biggest risk factor in Coinbase is that it is a bet on an unproven asset class that was created just over a decade ago. Coinbase attempts to make it clear that its fate is linked to the prospects for Bitcoin and ethereum and the thousands of other alternative coins that have been written into existence.
But a decline in interest and tough regulations in the U.S. and elsewhere could wallop the exchange platform.