Coinbase shareholders have reportedly been informed by the firm that a secondary market sale will be afforded to current stock owners before the company goes public in 2021.
Midway through December 2020 Coinbase announced that it has filed the necessary documentation for an initial public offering. The company submitted a draft registration statement with the US Securities and Exchange Commission, the details of which are still confidential.
An initial report from The Block Crypto revealed that shareholders had received official word from Coinbase that the Nasdaq Private Market would make contact with them on January 25 with details on how they can access the market, what shares will be eligible for trading and how the market will function.
It is understood that the secondary market will allow current and former employees with shares in Coinbase to sell their shares as well as current shareholders, before the company goes public.
The report also said that Coinbase is expected to opt for a direct public listing in favour of a standard IPO. Data from The Block’s analytics platform suggests that Coinbase could be worth around $70bln.
Value predictions of IPO vary
Late last year The Daily Chain also reported that investment management firm Goldman Sachs would handle the upcoming Coinbase initial public offering. Coinbase has links with Goldman Sachs through one of its board members, Fred Ehrsam, who previously worked at the firm as a trader from 2010 to 2012. He went on to co-found Coinbase alongside CEO Brian Armstrong.
Nevertheless the potential value of the IPO has drawn differing predictions. Morgan Creek Digital co-founder Anthony Pompliano suggested that the company could price the IPO between $20 billion and $30 billion due to its annual revenue numbers likely being in excess of $500 mln.
Cryptocurrency analytics firm Messari also offered a similar prediction for the potential valuation of the IPO, arriving at an estimated $28bln valuation of the IPO.