Coinbase is reportedly in the process of finalizing a deal that will help the company cross a valuation of approximately $8 billion. The transaction will make it the highest-worth company in the US and also benefit legitimize cryptocurrency industry as a whole.
The company has been reported to be in talking terms with Tiger Global and its active shareholders for a funding of $500 million, as informed by people close to the matter. The company is likely to keep nearly $250 million for itself out of the total amount to be invested and the remaining amount will be utilized towards adding new investors. However, the exact amount to be invested is not yet revealed.
Coinbase is a pioneer in trading crypto assets that makes money on each transaction. In the past quarter, the company valued at about $1.5 billion but the timing was not really great due to tremendous split in customers’ interest in cryptocurrencies like Bitcoin which made the company suffer a lot. Coinbase CEO, ‘Brian Armstrong’ said that the company is not focusing on making profits rather it is more concerned about creating an open financial system for the entire world.
Coinbase had reportedly talked to every investor about the secondary stock sale to enable existing investors of the company to cash-out without any requirement for the company to raise new money for its operations. At one point, the inbound interest was so high that the company had to issue a serious notification addressing the deal-makers requesting them to step back from Coinbase and its shareholders.
The deal of secondary sale never completed because it was moving extremely slow. But, the spokesperson of Coinbase has declined to say anything on the secondary sale. That was quite obvious because the deal is about $8 billion and it’s the same price Coinbase is trying to value itself. In 2018, Coinbase has achieved tremendous growth as far as expansion is concerned and now it is also preparing itself for a possible IPO.
When it comes to IPOs the investors usually look to invest in the company with promising governance. Coinbase has already prepared for it as it does not want to lose any opportunity to increase its worth in the market and be a dominating player in the crypto market. The company has reportedly added “Chris Dodds” to its management team who earlier worked with traditional brokerage company Charles Schwab. Coinbase needs to wait a bit as it makes a move towards tapping profit from the cryptocurrency market. The company may have denied its focus of multiplying the profits; it will surely work towards increasing its market value.
New York-based investment giant “Tiger Global” is often attracted towards such big deals in consumer-facing brands all over the world. Tiger Global has not shown much interest in cryptocurrencies but promising Silicon Valley interest still has its doors open to grow along with established investors. Perhaps Coinbase will eventually become its own publicly traded company and raise capital among other blockchain stocks.