May 15, 2021

How will Coinbase's IPO affect the industry?

How will Coinbase's IPO affect the industry?

Yuri Mazur, Head of Data Analysis Department, CEX.IO Broker

- Coinbase IPO is a landmark eventfor the cryptocurrency industry, as this is the first listing of a cryptocurrency company on the NASDAQ. All cryptocurrency media anticipated this listing. But the fact that the company's capitalization was estimated by NASDAQ at $ 65.3 billion and grew to $ 85.8 billion in the first trading session should attract the attention of general media around the world, therefore, positively affect the attention to the industry as a whole.

However, in our opinion, one should not expect significant the impact of a Coinbase listing on market dynamicscryptocurrencies. Bitcoin and Ethereum are too decentralized for the initial public offering of one exchange to significantly increase or decrease their capitalization.

Coinbase was listed on April 14, and onDuring the two trading sessions on April 14 and 15, Bitcoin volatility was relatively low. On the CEX.IO exchange, the BTC rate during this time was mostly in the range of $ 62,250 - $ 63,500. This suggests that there has been no serious reaction to the IPO in the cryptocurrency market.

We believe that this event has already been, and in the future there will be no noticeable influence on the rates of the most popular cryptocurrencies. However, the situation on the crypto market will directly affect the value of the stock exchange.

Also, in our opinion, the Coinbase IPO will setsome bar for the implementation of financial reporting and various legal procedures for other representatives of the cryptoindustry who want to follow the example of the American company.

But direct investment in bitcoin and otherscryptocurrencies from the side of large market players will continue to have a defining influence on their market dynamics. The event can also provoke a wave of public placements of cryptocurrency exchanges and other companies from this industry.