TechCentralTechCentral
    Facebook Twitter YouTube LinkedIn
    Facebook Twitter LinkedIn YouTube
    TechCentral TechCentral
    NEWSLETTER
    • News

      Unlawful Eskom strike costing South Africa three stages of load shedding

      1 July 2022

      Google.co.za is down and the domain is pending deletion

      1 July 2022

      US files charges over South African bitcoin fraud scheme

      1 July 2022

      Hein Engelbrecht to lead Mustek as its new CEO

      1 July 2022

      Alviva shares leap higher on R3-billion take-private offer

      30 June 2022
    • World

      Meta girds for ‘fierce’ headwinds

      1 July 2022

      Graphics card prices plummet as crypto demand dries up

      30 June 2022

      Bitcoin just had its worst quarter in a decade

      30 June 2022

      Samsung beats TSMC to 3nm chip production

      30 June 2022

      Napster plots crypto comeback

      29 June 2022
    • In-depth

      The NFT party is over

      30 June 2022

      The great crypto crash: the fallout, and what happens next

      22 June 2022

      Goodbye, Internet Explorer – you really won’t be missed

      19 June 2022

      Oracle’s database dominance threatened by rise of cloud-first rivals

      13 June 2022

      Everything Apple announced at WWDC – in less than 500 words

      7 June 2022
    • Podcasts

      How your organisation can triage its information security risk

      22 June 2022

      Everything PC S01E06 – ‘Apple Silicon’

      15 June 2022

      The youth might just save us

      15 June 2022

      Everything PC S01E05 – ‘Nvidia: The Green Goblin’

      8 June 2022

      Everything PC S01E04 – ‘The story of Intel – part 2’

      1 June 2022
    • Opinion

      Has South Africa’s advertising industry lost its way?

      21 June 2022

      Rob Lith: What Icasa’s spectrum auction means for SA companies

      13 June 2022

      A proposed solution to crypto’s stablecoin problem

      19 May 2022

      From spectrum to roads, why fixing SA’s problems is an uphill battle

      19 April 2022

      How AI is being deployed in the fight against cybercriminals

      8 April 2022
    • Company Hubs
      • 1-grid
      • Altron Document Solutions
      • Amplitude
      • Atvance Intellect
      • Axiz
      • BOATech
      • CallMiner
      • Digital Generation
      • E4
      • ESET
      • Euphoria Telecom
      • IBM
      • Kyocera Document Solutions
      • Microsoft
      • Nutanix
      • One Trust
      • Pinnacle
      • Skybox Security
      • SkyWire
      • Tarsus on Demand
      • Videri Digital
      • Zendesk
    • Sections
      • Banking
      • Broadcasting and Media
      • Cloud computing
      • Consumer electronics
      • Cryptocurrencies
      • Education and skills
      • Energy
      • Fintech
      • Information security
      • Internet and connectivity
      • Internet of Things
      • Investment
      • IT services
      • Motoring and transport
      • Public sector
      • Science
      • Social media
      • Talent and leadership
      • Telecoms
    • Advertise
    TechCentralTechCentral
    Home»Sections»Cryptocurrencies»Coinbase listing marks latest step in crypto’s march to the mainstream

    Coinbase listing marks latest step in crypto’s march to the mainstream

    Cryptocurrencies By Agency Staff14 April 2021
    Facebook Twitter LinkedIn WhatsApp Telegram Email
    Executium/Unsplash

    Coinbase Global, the biggest US cryptocurrency exchange, will list on the Nasdaq on Wednesday, marking a milestone in the journey of virtual currencies from niche technology to mainstream asset.

    The listing is by far the biggest yet of a cryptocurrency company, with the San Francisco-based firm saying last month that private market transactions had valued the company at around US$68-billion this year, versus $5.8-billion in September.

    It represents the latest breakthrough for acceptance of cryptocurrencies, an asset class that only a few years ago had been shunned by mainstream finance, according to interviews with investors, analysts and executives.

    The listing is significant in that it marks the growth of the industry and its acceptance into mainstream business

    “The listing is significant in that it marks the growth of the industry and its acceptance into mainstream business,” said William Cong, an associate professor of finance at Cornell University’s SC Johnson College of Business.

    Bitcoin, the biggest cryptocurrency, hit a record of over $64 000 on Wednesday. It has more than doubled this year as large investors, banks from Goldman Sachs to Morgan Stanley and household name companies such as Tesla warm to the emerging asset.

    ‘Very positive’

    Coinbase’s direct listing — which means it has not sold any shares ahead of its market debut — is likely to accelerate that process by boosting awareness of digital assets among investors.

    “This is a very positive thing for bitcoin in itself, as it proves the bridge that has been built from an esoteric, left-of-field arena, full of cowboys, to mainstream finance,” said Charles Hayter of data firm CryptoCompare.

    Still, some institutional investors voiced caution over long-term prospects for Coinbase and the crypto sector.

    Swiss asset manager Unigestion said it was wary of the hype around cryptocurrencies, and as a result would not be buying Coinbase stock.

    “We think there is a lot of frenzy and exuberance in everything that looks like crypto,” said Olivier Marciot, a portfolio manager at Unigestion, which oversees assets worth $22.6-billion.

    “Hedge funds and retail will probably be the early birds in these new stocks — probably buying into them pretty heavily — which shouldn’t be a clear indication of how they will be in the longer term.”

    Others experts said risks included Coinbase’s exposure to a highly volatile asset that is still subject to patchy regulation.

    Founded in 2012, Coinbase boasts 56 million users globally and an estimated $223-billion assets on its platform, accounting for 11.3% crypto asset market share, according to regulatory filings.

    When price of bitcoin goes down, it’s inevitable that Coinbase’s revenue and inherently price of the stock will decline as well

    The company’s most recent financial results underscore how revenues have surged in lock-step with the rally in bitcoin trading volumes and price.

    In the first quarter of the year, as bitcoin more than doubled in price, Coinbase estimated revenue of over $1.8-billion and net income between $730-million to $800-million, versus revenue of $1.3-billion for the entire 2020.

    “The correlation to bitcoin will be very high after the stock stabilises after listing,” said Larry Cermak, director of research at crypto website The Block. “When price of bitcoin goes down, it’s inevitable that Coinbase’s revenue and inherently price of the stock will decline as well.”

    Risks

    Regulatory risks also loom, others said, as Coinbase increases the number of digital assets users can trade on its platform.

    Coinbase last year suspended trading in major digital currency XRP after US regulators charged associated blockchain firm Ripple with a $1.3-billion unregistered securities offering. Ripple has denied the charges.

    “Given the expansion of assets covered by Coinbase it’s almost inevitable that other listings will come into question,” said Colin Platt, chief operating officer of crypto platform Unifty.

    Coinbase declined to comment.  — Reported by Tom Wilson and Anna Irrera, (c) 2021 Reuters

    Bitcoin Coinbase Coinbase Global top
    Share. Facebook Twitter LinkedIn WhatsApp Telegram Email
    Previous ArticleTikTok founder now among the world’s richest people
    Next Article Hydrogen refuelling stations to be built on N3 highway

    Related Posts

    Unlawful Eskom strike costing South Africa three stages of load shedding

    1 July 2022

    Google.co.za is down and the domain is pending deletion

    1 July 2022

    US files charges over South African bitcoin fraud scheme

    1 July 2022
    Add A Comment

    Comments are closed.

    Promoted

    Billetterie simplifies interactions between law firms and clients

    30 June 2022

    Think herding cats is tricky? Try herding a cloud

    29 June 2022

    How your business can help hybrid workers effectively

    28 June 2022
    Opinion

    Has South Africa’s advertising industry lost its way?

    21 June 2022

    Rob Lith: What Icasa’s spectrum auction means for SA companies

    13 June 2022

    A proposed solution to crypto’s stablecoin problem

    19 May 2022

    Subscribe to Updates

    Get the best South African technology news and analysis delivered to your e-mail inbox every morning.

    © 2009 - 2022 NewsCentral Media

    Type above and press Enter to search. Press Esc to cancel.