Coinbase's Financials Are Now Public Ahead of Stock Market Listing

Crypto exchange Coinbase is officially going to become a publicly traded company.

Its Form S-1 has been published by the U.S. Securities and Exchange Commission (SEC), clearing the way for its much-anticipated direct listing on Nasdaq. 

The move caps a seven-month effort by the exchange to go public. Rumors first emerged Coinbase was exploring a direct listing on a U.S. stock exchange last summer, though the company didn’t confirm the news until December. 

At the time, the exchange only announced it had confidentially filed its Form S-1 with the SEC. Coinbase didn’t confirm it was looking to list its Class A shares directly until last month.

The publication of Coinbase’s S-1 provides the first public view of its financial performance and how it intends to use the funds it raises. 

"We expect our operating expenses to increase significantly in the foreseeable future and may not be able to achieve profitability or achieve positive cash flow from operations on a consistent basis, which may cause our business, operating results, and financial condition to be adversely impacted," the firm stated in the filing, adding:

Coinbase also confirmed that it is using Goldman Sachs, J.P. Morgan Securities and Citigroup to "assist us with respect to certain matters relating to our listing."

Other key details include compensation for CEO Brian Armstrong, who took home $59.5 million in 2020 all told.

"We have applied to list our Class A common stock on the Nasdaq Global Select Market under the symbol 'COIN,'" Coinbase wrote.

According to the Wilson Sonsini Goodrich & Rosati law firm, trading may not begin until the day after the form is deemed effective.

The company was expected to go public at a $100 billion valuation based on private secondary market trading at the end of last week. The prior week’s trading put Coinbase’s presumed valuation at $77 billion.

The exchange disclosed Thursday that it has been putting crypto assets, including bitcoin, on its balance sheet since it was founded in 2012.

Coinbase isn’t the only crypto company looking to go public. Bakkt, a subsidiary of Intercontinental Exchange (which is also the parent company to Nasdaq rival New York Stock Exchange) is expected to go public on the NYSE through a merger with VPC Impact Acquisition Holdings, a special-purpose acquisition company. A search of NYSE’s listing directory did not show Bakkt Holdings at press time.

UPDATE (Feb. 26, 2021, 20:15 UTC): A previous version of this article said a pricing committee would determine the public price of the stock. While that is true for initial public offerings, buyers and sellers determine price in a direct listing like what Coinbase will conduct.