[HN Gopher] Coinbase announces proposed direct listing
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Coinbase announces proposed direct listing
Author : coloneltcb
Score : 265 points
Date : 2021-01-28 19:20 UTC (3 hours ago)
(HTM) web link (blog.coinbase.com)
(TXT) w3m dump (blog.coinbase.com)
| devops000 wrote:
| They will be correlated with BTC/USD
| paxys wrote:
| Nope, I doubt it. It's much easier to sell shovels and still
| benefit whether the price goes up or down.
| xiphias2 wrote:
| At the time a lot of gold was mined in California, the gold
| supply increased a lot as well. With Bitcoin the supply is
| algorithmically limited.
| gaspard234 wrote:
| Well real world gold is also limited. The California
| mountains used to be rich with huge veins of gold and now
| while you can still find some in these places it is very
| rare compared to the 1800's.
| paxys wrote:
| Trading activity can still be high regardless of new
| supply, and that is what Coinbase is capitalizing on.
| devops000 wrote:
| If price will reach 1,200$ in next three years I think the
| volume will be much lower
| hntrader wrote:
| This will be the main mechanism positively correlating BTC
| price with Coinbase's stock price. The correlation will be
| weaker than that with MARA and RIOT though.
| jy1 wrote:
| Gold price dictates how many shovels are being sold.
|
| Similarly BTC prices dictates gross volumes.
| rblatz wrote:
| One more company off the shortlist of potential targets for the
| PSTH SPAC.
|
| Looking more and more like it's going to be something like
| Subway.
| Marciplan wrote:
| Its gonna be WeWork
| ffggvv wrote:
| :/ do we just sell?
| fortydegrees wrote:
| Slightly off topic but can anyone explain to me why a massive
| company like coinbase uses Medium as a blogging
| platform/software? Why are they not hosting the blog within their
| own ecosystem/site?
| miguelmota wrote:
| Possible reasons:
|
| 1. Allocation of engineering effort
|
| 2. Familiarity with readers
|
| 3. Discoverability
| londons_explore wrote:
| I could imagine coinbase have critical cookies containing user
| sessions attached to coinbase.com.
|
| If they have a wordpress blog at blog.coinbase.com, then any
| xss attack in wordpress can steal customer accounts.
|
| Sure, it's a fixable problem (by moving high security cookies
| into login.coinbase.com or something similar), but that's a big
| migration, and probably nowhere near the top of the engineering
| priority list.
| yepthatsreality wrote:
| Trendiness.
| trimbo wrote:
| Sure. Because if you're a startup hiring SWEs, which are a
| scarce resource, why would you want them implementing something
| that exists and isn't part of your core business?
|
| Also, the customer is the PR/marketing department, not the
| engineering department. The marketing people already know how
| to use these platforms well, so just let them use those.
| mdorazio wrote:
| The vast majority of the population is not at all like HN
| readers and doesn't even know what Coinbase is. Blogging on
| Medium gives them much better exposure and reach to non-crypto
| people who might become interested in them because it popped up
| on their Medium feed vs. on the Coinbase blog.
| duxup wrote:
| >doesn't even know what Coinbase is.
|
| I kinda wonder about that. I've been INUNDATED by Coinbase
| advertisements on mobile apps and etc talking about
| incentives for learning what they do and etc.
|
| They seem to really be pushing to get the general public on
| board.
| lozf wrote:
| Perhaps true, but conversely you could also argue that the
| sheer number of scams and frauds in the Cryptocurrency space
| that had medium blogs might also put people off!
| pinko wrote:
| The vast majority of the population has a Medium feed?
| hbosch wrote:
| Same reason companies use Twitter and Facebook.
| nisten wrote:
| From a technical point of view yes, your own hosted static site
| is way more efficient, you have more control over the stack,
| scaling, better metrics, security etc, etc.
|
| From a business point of view it's more like...who the f*ck
| cares what you use? Did they read it? Yes? Good, move on.
| MartianSquirrel wrote:
| > _From a business point of view it 's more like..._
|
| Usually companies use blogs as marketing tools to drive
| traffic to their websites. I might be wrong, but in the case
| of Coinbase I have never really seen anything they wrote that
| was precisely intended at selling a product. It's usually
| more informative, and shows they are trying to be more of a
| positive force in the industry compared to a dominant one.
| Kudos on them if it is the intent, and I guess it would
| explain the choice of platform instead of investing time and
| assets in developing their own.
| foobiekr wrote:
| The usual alternative is Wordpress.
|
| Which, honestly, is frequently deployed so poorly that it
| becomes an attack vector.
| dogecoinbase wrote:
| Because a16z led funding rounds for both Coinbase and Medium.
| matthewowen wrote:
| why would you spend engineering time on your blog when you can
| get something off the shelf / outsource it?
|
| the opportunity cost is too high.
| bawolff wrote:
| Its distracting to have extra things that engineers have to
| look at every once in a while. Its cheaper when accounting for
| employee time to just outsource random non business critical
| things.
|
| Look at the dns entries for lots of big company's blogs. Many
| of them are just CNAMEs for wpengine or some other third party
| host.
| iandanforth wrote:
| Don't forget - This company actively removed employees who were
| willing to stand up against societal ills.*
|
| *Yes I know this makes some people like them more.
| px43 wrote:
| From what I recall, it's more like they said they aren't going
| to take public stands on divisive political issues, and they
| offered generous separation packages to anyone who had a
| problem with that. No one was discouraged against getting
| politically active on their own time, and no one was "removed".
|
| https://www.forbes.com/sites/rachelsandler/2020/10/08/60-emp...
|
| As someone who has never lived in the bay area, it was kind of
| surreal to see employees expecting their company to get
| involved in amplifying their own personal political
| preferences. I've always been reasonably politically active,
| and had fairly liberal coworkers who, even if not politically
| active, at least believe similarly. I've always thought that
| work hours are for working though, and political activism has
| always seemed like more of an "after hours" activity.
|
| It's nice when a company says they're in support of one thing
| or another, but it doesn't really mean anything without human
| boots on the ground willing to put in the work to make positive
| change happen. Corporate PR press releases always seemed really
| insincere anyway, so I don't get why people would be upset when
| some company decides that they're not going to do them.
| divs1210 wrote:
| Coinbase can be the next Robinhood.
|
| It will be much better if the crypto community moved to
| decentralized exchanges like Bisq.
| xiphias2 wrote:
| Uniswap is already huge.
|
| For Bisq to succeed governments needs to clamp down on central
| exchanges, but so far that is not happening.
| aresant wrote:
| If there's one thing to take away from the GME debacle it is that
| organized, incentivized retail investors can make a stock do
| crazy things.
|
| Now take that and multiply it by a factorial with the general
| interest, shilling, and breadth of the crypto community!
|
| Recipe for INSANITY around this listing.
| slickrick216 wrote:
| Good free markets should be free. No government bailouts no
| problem.
| marcinzm wrote:
| Then eventually things implode, society collapses, a dictator
| takes over after claiming they will help the starving masses
| and so on. Starving masses who have lost their life savings
| do not make for a good place to live even if you avoid being
| one of them. Society should be protected from the fallout of
| capitalism to a reasonable degree.
| slickrick216 wrote:
| I don't know what the alternative is are you in favour of
| propping up private companies and keeping this status quo?
| That's alternative of free markets. Right now they aren't
| free. AOC and Ben Shapiro of all people agree for once.
| This is a stage 7 brundlefly economic system.
| marcinzm wrote:
| "Free markets" are never perfectly free or even close to
| it. Only the writers of utopian libertarian science
| fiction think that.
|
| The question is how you manage that lack of freedom and
| to whose benefit you try to manage it. I prefer it be
| managed towards the general stability of society. Of
| course it will be managed in an imperfect way but I
| prefer the goal be a stable society.
|
| edit: The government intervening will never really make
| the market more free but it wasn't free to begin with
| (see robinhood today). So you lose a bit more freedom but
| you shift the benefit of the overall loss of freedom from
| "a bunch of rich people get richer" to "society as a
| whole get's richer and more stable." Not fully but a bit
| further.
| LegitShady wrote:
| While i agree with you in principle, there's a difference
| between "this market is regulated" and "this market will
| be bailed out at random on the whims of politicians,
| while this other market or firm won't" in which case we
| start to have issues.
| anewaccount2021 wrote:
| If you lost your life savings on GME, you deserve to starve
|
| edit: the only way you could be losing your life savings on
| GME is with a dumb, arrogant short position. yes, you
| should starve...isn't this what a short sale is anyway? A
| bet that someone else will starve?
| marcinzm wrote:
| Personally I prefer to not be stabbed to death by a
| starving person who lost their life savings on GME so
| they can steal $10 from my wallet. Massive societal
| implosions tend to have a large blast radius.
| kazen44 wrote:
| actually, it has shown time and time again that unregulated
| capitalism is just not working for a majority of the
| population.
|
| The myth of the "free market" is in the same vein as the
| centrally planned economy of a socialist state.
| whb07 wrote:
| Protected by people with lofty ideals like yourself? Where
| are these high minded incorruptible individuals?
|
| Governments are the cause of mass starvation and murders,
| please see China, USSR, Germany, and on and on.
| marcinzm wrote:
| >Governments are the cause of mass starvation and
| murders, please see China, USSR, Germany, and on and on.
|
| All caused by revolutions caused by massive economic
| issues and societal issues. In other words, capitalistic
| collapse of society leads to dictatorship which leads to
| horrible things. Like I said in the post you replied to.
| So thank you for making my argument for me.
| lukifer wrote:
| Governments also commit mass murder on behalf of the
| interests of private capital, ranging from feudal land
| enclosures, to the United Fruit Company in Honduras [0],
| to modern oil interests and the military-industrial
| complex.
|
| [0] https://en.wikipedia.org/wiki/War_Is_a_Racket
| rmah wrote:
| Why?
| Ericson2314 wrote:
| ...maybe if we have the one true Geiger Counter to call the
| debt jubilees
| [deleted]
| lukifer wrote:
| Are you familiar with the work of Michael Hudson? I just
| learned of "...and forgive them their debts" [0], and
| looking forward to reading it.
|
| While I'm generally in favor of debt forgiveness for 2021
| America, in his talks he's primarily described jubilees in
| the context of regime change: a new conquering emperor, or
| an aspiring revolutionary leader, cancels the debts to
| secure the loyalty of workers and soldiers, and the
| nobility has to acquiesce at the point of a sword.
|
| What I can't figure out is how this could be done on a
| predictable timetable (as per the Biblical jubilee concept:
| every 7 or 50 years). In a conquest scenario, a lender
| might only withhold lending if the current power structure
| looked weak; but if debt forgiveness was institutionalized,
| why wouldn't they just cease all lending on Year 6 or Year
| 49? (Or, more likely: fold the probability of forgiveness
| into a usurious interest rate, so they collect the same
| income on average.)
|
| As it stands, I think debt forgiveness can only be done as
| a one-time solution to gross inequality and/or social
| instability; and that institutional reform (to not need
| jubilees) has to be done upstream (such as public banking,
| Georgist land trusts, etc). But I'm very open to being
| convinced otherwise.
|
| [0] https://www.goodreads.com/book/show/42515482-and-
| forgive-the...
| Ericson2314 wrote:
| I am aware-ish of that Graeber's book but haven't read
| either.
|
| The Geiger counter randomized debt jubilee is a bit of a
| play on the scheduling problem.
|
| I do agree debt jubilees only make sense as a emergency
| post-hoc fix. If you think about it, UBI + good
| confiscatory taxes at the margins is basically a nice
| smoothed amortized debt jubilee. That's much better.
| skeeter2020 wrote:
| too bad you can't get that ticker symbol
| fossuser wrote:
| It's another centralized exchange though.
|
| I think the DeFi work is more interesting, particularly stuff
| like this: https://uniswap.org/
|
| Still early, but truly decentralized exchanges are super
| interesting.
| electriclove wrote:
| Yes, but Coinbase is one of the major gateways to that. Most
| people will need to use a CEX to convert their Fiat to
| crypto.
| fossuser wrote:
| Yeah, I agree and think it's likely to do well as the
| dominant and trusted centralized exchange to get fiat in
| and out.
|
| I just don't see them as that different from Robinhood in
| the service they provide and the risks associated with it.
| electriclove wrote:
| We are on the same page. Defi is the future. I'm hopeful
| this is a big step in getting there.
| 1996 wrote:
| If this listing happens, BTC will go above 150k in 2021.
|
| Too many people with money and time on their hands.
| jaywalk wrote:
| Obviously this was planned well in advance, but what a day to
| make this announcement.
| MuffinFlavored wrote:
| How long until Coinbase blocks the buying of popular tickers
| too because powerful hedge funds tell them?
| meowkit wrote:
| Not likely because the market makers will have to compete
| with DeFi on chain.
| [deleted]
| bdcravens wrote:
| Coinbase has frozen trading of various cryptos before.
| blhack wrote:
| They have already paused trading during periods of high
| turmoil. When bcash was announced, for instance. I think that
| actually set their standard for "open the market in 'post
| only' mode for a period before actually starting trading".
| llampx wrote:
| I wonder if they would have blocked the purchase of Dog coin
| formercoder wrote:
| Curious what the accounting rules are around their BTC on the
| balance sheet. Would be wild if they had to mark to market.
| zionic wrote:
| They hold their crypto in grayscale. They'll dump IPO cash into
| the market and spike the price so their grayscale assets blow
| up.
| dahdum wrote:
| I don't think they hold much on their balance sheet, otherwise
| they wouldn't have needed multiple rounds of financing through
| 2018.
| throwaway803453 wrote:
| Given the hype, the most likely scenario is a > 2X price spike in
| the first few minutes of trading regardless of the initial market
| cap ($100B+?). For those of us who believe that, what is the best
| strategy for purchasing shares ? It's doubtful brokers will allow
| market orders the previous night since the ticker might not yet
| exist, and if one places a market order during the first few
| minutes the cynic in me predicts a retail trader will get the
| worst deal.
| taurath wrote:
| This is always how it works. Institutionals always get first
| dibs (and the middle, and the last)
| brainflake wrote:
| Well not necessarily... didn't google use a dutch auction 15
| years ago?
| harryh wrote:
| Not with a direct listing.
|
| Coinbase shares would be subject to an auction and the market
| for them will open at the price where supply meets demand.
| Triv888 wrote:
| Do you see anything wrong with that?
| josht wrote:
| Better question: Do you see anything right with that?
| Triv888 wrote:
| I know that he was being sarcastic... hopefully that will
| mess up with the AI wannabes...
| hntrader wrote:
| After a new listing, retail can buy at the same instant as
| institutions, as long as the retail broker allows it, and
| many do.
| svachalek wrote:
| I think generally you can place an order before the market
| opens, maybe even the day before, but that doesn't really give
| you any pricing power. It will still pop at the open and your
| order may not clear until it does. But that may still put you
| ahead of the Robinhood masses.
|
| Better option might be to try a pre-IPO trading platform like
| EquityZen.
| throwaway803453 wrote:
| From EquitZen's knowledge center:
|
| "Shares that are the subject of investment through EquityZen
| are generally subject to a lock-up period of up to 180 days
| after the effectiveness of a company's IPO filing, during
| which time shareholders are restricted from selling their
| shares."[1]
|
| The 180day lock-up period could EquityZen poorly suited for
| investors with a short time horizon.
| la6471 wrote:
| If a SPAC is floated to do this retail investors might still
| have a chance
| nostrademons wrote:
| The SPAC would have to convince Coinbase that it's in their
| interests to go public via reverse merger rather than direct
| listing. This seems pretty unlikely, given that they've
| already filed their S-1, announced the direct listing, and
| presumably have done all the paperwork related to being a
| public company.
|
| There's a bit of an adverse-selection problem with SPACs: not
| only do they need to find an undervalued asset that the
| public markets will value for more than the acquisition
| price, they need to convince that asset that the SPAC adds
| value and can take them public easier than doing the process
| themselves would. Big tech companies like Coinbase, AirBnB,
| and Roblox have plenty of money to hire the lawyers,
| accountants, and investment bankers that going public
| themselves requires.
| DSingularity wrote:
| We already knew this, right? What is new?
| azinman2 wrote:
| https://xkcd.com/1053/
| DSingularity wrote:
| umm I am actually genuinly trying to understand what
| changed... I thought they already told us they are planning
| to do an IPO.
| legym wrote:
| What are the odds of this.
|
| The cofounder of reddit, Alexis Ohanian, owns a capital firm
| called Initialized Capital. That firm owns coinbase.
|
| https://blog.coinbase.com/coinbase-announces-proposed-direct...
| garry wrote:
| Can confirm we own a portion of Coinbase but not the whole
| thing (if only) :-)
| adenozine wrote:
| This is literally an outright lie. Initialized Capital does not
| own Coinbase.
| [deleted]
| wmf wrote:
| Why isn't Coinbase doing a security token offering?
| chrisco255 wrote:
| Because there's already a lot of network effects built in to
| the existing exchanges and crypto infrastructure for trading
| securities is still immature, albeit promising.
| RangerScience wrote:
| What's out their right now in the way of crypt infra for
| securities / stock trading?
|
| I predict that as the news digests GAMESTONKS, we're gonna
| see a decent amount of talk about crypto and a block-chain
| based stock market.
|
| But I'm far out of the crypto loop these days so IDK what the
| contenders are.
| reducesuffering wrote:
| Real money for me, not for thee.
| er4hn wrote:
| reducesuffering, thank you for making me chuckle.
|
| In keeping with the grand theory that cryptocoins allow the
| rediscovery of financial regulations and procedures from
| first principles, the following could happen:
|
| * Coinbase uses the funding to get to the point where they
| can release a "dual currency" set of stock. One set of stock
| based on being traditional shares purchased with USD, one set
| based on being a tied to a "share token" purchased with
| whatever people choose to exchange (but initially sold by
| Coinbase for bitcoin). Presumably they would have voting
| rights per share tied to the conversion between bitcoin to
| usd.
|
| * The normal shares are regulated in the boring SEC way.
|
| * The share tokens are regulated according to wild west tech
| rules. Tokens are stolen, token private keys are lost,
| exchanges rediscover circuit breakers on facilitating token
| trades, etc.
|
| I think there is also a second story if Coinbase were to
| release share tokens: Many scamcoins are essentially a way to
| buy shares in some service that does not fully exist yet, but
| has great upside potential. If this super simplistic
| description sounds like investing in stocks, then watching
| Coinbase share tokens toe the line between "scam coin" and
| "real deal Wall St. asset" will be an interesting experience.
| wmf wrote:
| _a way to buy shares in some service that does not fully
| exist yet, but has great upside potential_
|
| Time for a SPAC token offering!
| eganist wrote:
| Ostensibly not enough faith in security tokens as a method of
| managing shares. Still surprising from a strategic angle
| considering an acquisition of a platform like Carta could have
| given them a head start.
| Triv888 wrote:
| Yeah, fuck the stock market at this point.
| sjtindell wrote:
| The quantity of potential capital raised I would assume.
| bdcravens wrote:
| Because it is a technology company built with traditional fiat
| investments.
| devops000 wrote:
| I guess it's a proof they don't believe it.
| zionic wrote:
| I suspect the plan is to raise tons of fiat then pump their BTC
| holdings via grayscale.
| xiphias2 wrote:
| They are thenselves institutional BTC holders, so I'm not
| sure if they need to outsource it.
|
| Microstrategy is using Coinbase.
| zionic wrote:
| That's my point exactly.
|
| Traditional stock market buys tons of coinbase cash ->
| coinbase uses said cash to market-buy BTC with bots driving
| the price up -> BTC/their crypto of choice is now worth far
| more.
|
| If the market follows their run they end up making far more
| than they reinvested.
| kinghajj wrote:
| My god, that would be amazing.
|
| 1. Coinbase raises money from the IPO. 2. Coinbase takes some
| of that money and gives it to Grayscale. 3. Grayscale uses
| the money to buy cryptocurrency... On Coinbase!
|
| Not only do Coinbase shares appreciate from the increased
| value of assets on their balance sheet, but they earn some of
| their money back from fees, too. Just make sure that steps #1
| and #2 have some delay, after any lock-up period.
|
| And since Grayscale can only divest from its funds for fees
| and doesn't allow redemption, more cryptocurrency tokens get
| "locked" in the funds indefinitely, unable to affect the spot
| price.
| deeeeplearning wrote:
| So what you're saying is Coins go up?
| purple_ferret wrote:
| If they were smart, they'd price it like at 2 dollars a share
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