US crypto exchange Coinbase seeks listing

SAN FRANCISCO • Coinbase Global, the biggest United States cryptocurrency exchange, said it has filed confidentially with the Securities and Exchange Commission (SEC) to go public in what is anticipated to be a breakthrough for the industry.

The San Francisco-based company said in a statement that it expects its draft registration filing to become effective after the SEC completes its review process. The company did not provide further details of its listing plans and a representative declined to comment beyond the announcement.

Coinbase was valued at more than US$8 billion (S$10.6 billion) in 2018 after a US$300 million funding round led by Tiger Global Management.

The company, started in 2012, has raised more than US$500 million from backers that also include Andreessen Horowitz, Y Combinator and Greylock Partners, according to its website.

Coinbase said it has more than 35 million verified in more than 100 countries and more than US$25 billion in assets on its platform.

Mr Kyle Samani, co-founder of MultiCoin Capital, said he expects Coinbase going public to be a “huge event” for the industry.

“It is a watershed for the asset class, both as a form of legitimisation, and by providing a way for investors to bet on the crypto industry without betting on a specific asset,” said Mr Samani, who is an investor in Coinbase.

Bitcoin hit an all-time high on Thursday of more than US$23,000, and has more than doubled this year.

PayPal Holdings has begun letting consumers use the cryptocurrency in transactions, and companies including Square and MicroStrategy have made bitcoin investments, prompting speculations that more institutional investors will jump into cryptocurrencies.

One River Asset Management, a hedge fund specialising in volatility bets, has quietly bought US$600 million worth of the digital currency, Bloomberg reported.

As cryptocurrency prices have risen, Coinbase has experienced performance issues this week, including connectivity problems and delays.

A Coinbase listing would be “a major exit for many early employees”, said Mr Nic Carter, co-founder of crypto researcher Coin Metrics. Those employees would have liquidity for angel investments and the means to start their own start-ups, Mr Carter said.

Several cryptocurrency-related companies, particularly exchanges, are already earning hundreds of millions or even billions in annual revenue, and more crypto start-ups are expected to go public or be acquired in the coming months.

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