Coinbase to Go Public Via Direct Listing
The major cryptocurrency trading platform will bypass a traditional IPO, becoming one of a handful of tech companies to have done so.
Coinbase, the most prominent cryptocurrency exchange platform in the US, is planning to go public through a direct listing, the firm announced in a statement on Thursday.
The San Francisco-based firm previously stated in December that it had confidentially filed registration documents with the US Securities and Exchange Commission (SEC), though it hadn’t disclosed that it would pursue a direct listing rather than a traditional initial public offering. Its statement on Thursday did not detail when the stock would be listed or under which ticker.
The SEC has approved a proposal from the New York Stock Exchange to allow companies to raise primary capital while listing directly, removing what had previously been a significant drawback of bypassing an IPO.
Direct listings enable companies to skip elements of the standard IPO. The need to price and sell a block of new equity is removed, allowing the firm to simply list its shares to become available for trading. This method usually requires a high degree of visibility to prove attractive.
As it goes public, Coinbase will join a small number of other tech companies that have previously undergone direct listings. Consumer-facing companies like Spotify have listed directly, and online video game company Roblox Corp has also announced its intention to go public via direct listing.
Founded in 2012, Coinbase allows its users to buy and trade decentralised tokens including bitcoin and Ethereum. It has raised $547.3 million in funds as a private company.