Cryptocurrency platform Coinbase Global Inc COIN had one of the largest public listings of all time when it went public via direct listing in April 2021. Here’s a look at how the stock has fared since the Coinbase IPO.
What happened: Coinbase went public on April 14, 2021. The company opted for a direct listing and went public at a time when it was seeing massive growth and the cryptocurrency market was booming.
Many analysts believed in the long-term success story of Coinbase. CNBC host Jim Cramer famous so he liked Coinbase to $475 in a tweet on the day of the company’s debut.
Ark Fund’s CEO Cathie Wood also backed the stock and began accumulating shares of the cryptocurrency platform for several Ark ETFs including its flagship Ark Innovation ETF SHEET.
Coinbase shares have fallen along with the appreciation of the major cryptocurrencies. Shares are down more than 60% year-to-date in 2022. Although the company saw shares rise Thursday on news that the company is partnering with Black stone BLK to provide institutional clients with direct access to cryptocurrencies, including Bitcoin.
With the Coinbase share price down significantly since its IPO, it begs the question of whether it would have fared better to invest in Bitcoin instead of shares of the cryptocurrency platform. Here is the answer.
Related Link: How to Buy Bitcoin
Invest $1000 in Coinbase IPO or Bitcoin: Coinbase shares debuted on April 14, 2021. Shares opened for trading at $381, significantly higher than an initial benchmark price of $250. Shares traded between $310 and $429.51 in the first day of trading and ended the day at $328.28, down from the opening price.
A $1,000 investment in the Coinbase IPO at the opening price of $381 could have bought 2.62 shares. Those same 2.62 shares would be worth $243.66 today, based on Friday’s close of $93. This corresponds to a decrease of 75.6%.
Bitcoin traded between $61,554.80 and $64,863.10 on April 14, 2021. A $1000 investment in Bitcoin at the opening price of $63,523.75 could have bought 0.01574 BTC. The $1,000 investment in Bitcoin will be worth $355.92 as of Friday, based on a price point of $22,612.18. This corresponds to a decrease of 64.4%.
While both investments would have been down over 60% since April 2021, investors would have been better off investing directly in Bitcoin rather than leading cryptocurrency platform Coinbase with its IPO.