Coinbase Exchange to Select Nasdaq Over NYSE For Direct Listing


Popular cryptocurrency exchange Coinbase has reportedly chosen to stage its highly anticipated direct placement on Nasdaq instead of the New York Stock Exchange.

Nasdaq not the NYSE

According to a recent publication by an online crypto news platform, TheBlock, sources familiar with the situation confirmed that the crypto exchange prefers to work with Nasdaq for its direct listing. This is a surprise since Coinbase has a working relationship with the NYSE.

The New York Stock Exchange had completed a minority investment in Coinbase way back in 2015 and would have felt the company would invariably work with them. It is unclear why it would choose to forgo a listing on the New York Stock Exchange (NYSE), which is known more for investing in quick-growth unicorns.

Direct listing allows a company to offer its shares to the public without having to raise new capital. This way investors can easily get their hands on the shares without having to wait for a standard IPO which usually takes time and is generally uneconomical.

With the SEC offering other means for companies to go public through a direct listing, 2021 is seeing a lot of them choosing this route. Popular tech firms like Spotify and Slack tapped into the global financial markets via a direct listing.

Trading and Valuation

Coinbase is also reportedly working with Nasdaq Private Market as a secondary market for its shares allowing pre-IPO shareholders, like employees, with vested equity to trade in the market before its official listing.

An unnamed source told The Block that Coinbase’s stock price was trading at $200/share on the Nasdaq Private Market, putting the company’s valuation at $50 billion with 254 million shares still up for grabs.

However, this figure shows a decline from Coinbase’s stock price which traded at $277/share on popular exchange FTX, giving the company a $70 billion valuation.

The valuation numbers are much better than previous estimates from New York-based research firm Messari.

Following Coinbase’s announcement that it had filed a Form S-1 with the SEC, many were keen to know what an IPO could fetch the firm in valuations. In its report, Messari pegged the exchange’s value at $28 billion.

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