Why is BSE not listed in BSE?
This is how bad the Coinbase share has slumped since going public
The crypto market went down significantly on Monday, not least because of Elon Musk - and with him the Coinbase share also suffers. This fell at the beginning of the week for the first time below the reference price of $ 250, which was set at the IPO in April. In the first few minutes of trading, the price on the New York tech stock exchange Nasdaq fell by more than 7.6 percent compared to the previous day to $ 238.69. It thus reached the lowest level in its admittedly short stock market history.
Compared to the first price at which the share was traded when it went public, the price is now more than 37 percent in the red. The stocks of the largest US crypto exchange started trading on April 14 at 381 dollars. In the first few minutes of trading, they even shot up to $ 429.54. From this peak it has fallen by almost 44 percent to date. The market value of Coinbase had meanwhile been well over 100 billion dollars on the first day of trading. It is now only $ 54 billion.
The reference price for direct placements is usually set too low
The Coinbase IPO was not carried out as an initial public offering (IPO), but as a direct listing. Investment banks do not look for investors and no new shares are issued, but the securities are listed directly on the stock exchange.
In contrast to classic IPOs, there is no offer price for direct placements - only a reference price. Its informative value is doubted by many observers - because no shares were actually bought or sold on the stock exchange at the price. In previous direct placements, the reference price often turned out to be very low and the shares rose massively on the first day of trading.
Quarterly figures did not give the share any boost
This also seemed to be the case at Coinbase at first. In the meantime, however, a completely different picture emerges. The quarterly figures published the previous week hadn't given the share any boost either: Coinbase had reported sales of $ 1.8 billion and net profit of $ 771 million for the first quarter of 2021. However, the basic figures had already been communicated in the run-up to the IPO, and the final results did not differ particularly significantly.
Since no new shares are issued in the case of direct placements, only those of existing investors can be bought in the IPO. In contrast to traditional IPOs, these in turn are not subject to any holding periods and can sell their shares from day one. This can create additional sales pressure in the first few weeks after direct placements.
Meanwhile, the globally larger competitor Binance has no plans for an IPO. Binance CEO CZ confirmed this in a recent interview.
Disclaimer:This text as well as the notes and information do not constitute tax advice, investment advice or a recommendation to buy or sell securities. They are for personal information only and only reflect the opinion of the author. No recommendation is made for a specific investment strategy. The contents of derbrutkasten.com are aimed exclusively at natural persons.
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