Coinbase Gets Significantly Lower Valuation For Direct Listing From Nasdaq

Cryptocurrency exchange Coinbase Global, Inc COIN, expected to list on the Nasdaq through a direct listing on Wednesday, has been assigned a reference price of $250 per share, according to Nasdaqtrader.com.

What Happened: Nasdaq is required to determine the price due to prevalent rules, and the price should not be confused with an offering price.

The opening public price for the shares will be determined based on buy and sell orders in the opening auction on Nasdaq, according to the statement.

See Also: How to Buy Coinbase IPO (COIN) Stock

This is the first major direct listing on Nasdaq, with previous high-profile listings such as Spotify Technology S.A. SPOT, Slack Technologies Inc WORK, Asana Inc ASAN, and Palantir Technologies Inc PLTR, all having taken place on the Intercontinental Exchange Inc ICE-run New York Stock Exchange.

Why It Matters: Earlier this month, the largest cryptocurrency exchange in the United States, Coinbase, disclosed an average share price of $343.58 in a private market auction in a filing with the U.S. Securities and Exchange Commission.

The auction implied a valuation of $89.8 billion for Coinbase, given the 261.3 million outstanding shares reported by the company. The Nasdaq reference price values Coinbase at about $65.3 billion. It's worth noting that such estimates are often conservative and the first day of trading gives a better idea of the market valuation of companies in direct listings.

Cryptocurrencies are on an upswing, with Bitcoin (BTC) hitting an all-time high of $63,742.28 on Monday.

The apex cryptocurrency traded 5.06% higher at $63,255.22 at press time.

See Also: Dogecoin Hits New All-Time High Above 10 Cents — Someone Go Tell Musk

What Else: The NYSE will release non-fungible token art to celebrate the first trades of certain companies including that of Spotify, which was the first direct listing on the exchange in 2018.

Photo Courtesy: Coinbase