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Coinbase to go public on 4/14
- nwhatt 6y agoIf I were to invest $100 in some allocation of Coinbase stock and Bitcoin - what should the ratio be?
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- wmeredith 6y agoCrypto is the gold rush. Coinbase is selling shovels. If you believe in crypto, they're both solid bets. I'd just diversify and go 50/50. This is not financial advice.
- mathattack 6y agoGood analogy. Think Cloudflare (shovels for tech) versus AirBnB (end user facing bet). Either way it’s a very specific bet. Diversification is your friend.
- lemoncurd 6y agoit is financial advice tho?
- cblconfederate 6y agoI wish they were doing an ICO instead (but i guess they can't?). $BNB has been the equivalent of shovels in past years.
- Tallasatree 6y ago$100 BTC : $0 CB.
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- rawtxapp 6y agoIf you believe in crypto, you can't go wrong with either one, one advantage of their stock is that you can invest through traditional means.
- DamnYuppie 6y agoThe best way to get into Crypto from a traditional brokerage account is GBTC. It tracks mainly BTC and Ethereum. It is not a perfect match though, sometimes you pay a premium and sometimes you get a discount to the underlying cryptos. Currently it is at nearly a 18% discount where earlier in the year it was at a 10% premium (GBTC is currently 50.87, BTC is $59,515). This is by no means a GREAT way to do it, just the best option currently if you are looking at crypto from a US based brokerage account.
- thebean11 6y agoWow, I figured it always traded at a premium. 18% discount is huge, am I missing some downside of this arb opportunity (buy GBTC sell short BTC or BTC futures)?
- ropiku 6y agoGBTC has no redemption mechanism, you can wrap more BTC into GBTC but not the other way around. For ETFs this is what solves the arb. You can do your arb but you still need to offload GBTC at some point and the only option is to another buyer of GBTC.
- itsoktocry 6y ago>The best way to get into Crypto from a traditional brokerage account is GBTC So this is basically 100% speculation, because you can't even use the crypto you "purchase"? You're just hoping for prices to go up. How does that make sense for a purported currency? If people aren't using it, what is the value?
- DamnYuppie 6y ago
- Consultant32452 6y agoJust my personal opinion.... Normies will be buying their bitcoin on cash app, paypal, etc. In this way I feel CoinBase is a niche product with limited growth capabilities long term. The more CoinBase makes, the more the big names in tech/finance will expand their efforts to compete. CoinBase is a decent short to medium term play imo, whereas bitcoin itself is a longer term play.
- throw1234651234 6y agoThis is an interesting outlook, not sure why it got downvoted.
- berberous 6y ago$80 ETH $10 BTC $10 COIN
- devmunchies 6y agowhy is this downvoted? going all in on the ETH ecosystem seems like a decent strategy.
- ball_of_lint 6y ago$60 BTC, $20 Coinbase, and $20 ETH is what I'm considering moving to, from previously $100 BTC.
- diplodocusaur 6y agoFunny. If you believe in bitcoin, then you would already have invested. Otherwise what you (and many others, but not all) believe in as an investor is the possibility of a return from storing your dollars in bitcoin and retrieving the value later. If you think this announcement would affect the price, look at price history data for the time of the announcement up to the date of going public. That could serve as some kind of signal given some model assumptions. Avoid confirming your own biases and establish your margin of risk as damage tolerance. As I see it, betting on coinbase is betting on the volume of transactions increasing over time.
- hn3333 6y agodeleted
- rawtxapp 6y agoIf history is any indication, we are still in the early cycle of the current bull run. I think they have delayed their IPO long enough, they were founded in 2012.
- gt565k 6y agoWhat does a brokerage/exchange going public have to do with the top of crypto currencies???? Crypto is here to stay. There's plenty of exciting projects like filecoin for decentralized storage, cardano for 3rd gen smart contracts, and more exciting projects that are coming online. I hate when people treat cryptocurrencies and stocks as just something you buy and sell. There's actually a vast amount of people and effort underneath blockchain projects that are trying to solve very hard problems. Just as stocks are an actual part of a company where people work hard to solve problems and create value in the economy.
- cblconfederate 6y agoThey also make money when people sell.
- jdminhbg 6y agoGetting a big price for the company isn't the only motivation for going public. They have employees and investors to take care of, even if they'd be 2X bigger in 2030 or something.
- endisneigh 6y agoUnder what circumstances would it make sense to invest in Coinbase compared to Bitcoin/underlying? Doesn't really make sense if you're bullish on crypto. Even seed investors who invested in Coinbase when it was founded would've been financially better off just buying Bitcoin/underlying. The situation here is unique because all of the popular coins have fixed supplies so any increase of popularity will have the commensurate increase in price. I don't see any situation in which Coinbase grows in price faster than the underlying.
- xeromal 6y agoNot saying this is true for Coinbase specifically, but sometimes it's better to sell shovels during a gold rush than dig for gold itself.
- kurko 6y agoI guess only if Coinbase stock price was set in Bitcoin. That way, as btc increases, so would the equivalent stock price in dollar.
- runawaybottle 6y agoI think Coinbase might own a lot of Bitcoin in general.
- lacker 6y agoThere are plenty of possible outcomes that would be better for Coinbase than for Bitcoin. Popularity of Ethereum, any other coins, or other sorts of crypto-based financial instruments. So far Bitcoin has done well but past performance does not necessarily predict future results. Also, anyone who holds index funds and no cryptocurrency, that strategy essentially ends up in them holding some Coinbase but no Bitcoin.
- endisneigh 6y agoI don't understand that. Can you spell out the circumstances in which Coinbase increases in price faster than any of the underlying? For the sake of discussion let's say you can either own some amount of Coinbase or a weighted average of the top 5 coins offered on Coinbase itself. In my view any instrument or tool that leverages a coin with a fixed supply means more popularity which means higher price for the coin. In the end Coinbase absorbs much of the benefit as it has expenses. I don't see any scenario in which Coinbase is more successful than a basket of the underlying. Now if coins were inflationary I could understand, but they're not. Seems dumb to buy Coinbase IMHO.
- blhack 6y agoAbsolutely fantastic news. Congratulations to the entire coinbase team! (Now please do better at customer service <3)`
- rvz 6y ago> Congratulations to the entire coinbase team! Yeah congratulations to the Coinbase founders, employees, VCs, investors and institutions who have a stake in Coinbase. They are the real winners in this IPO. The losers will be the foolish late retail investor who buys on IPO day. (Since it will dump due to the institutions selling off) and the past employees who walked out due to Coinbase's stance during the woke revolt of 2020. Surely they will now tell you that it was all worth it. /s For them, they can now buy it again for >$200 a share on IPO day with a smile on their face like the rest of us. :) Downvoters: So you want to buy Coinbase stock at over $200 a share on IPO day and be holding the bag when it drops when the founders, investors and employees start selling 10% of their shares? Sounds like a FOMO investor mindset to have.
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- rvz 5y ago> The losers will be the foolish late retail investor who buys on IPO day. (Since it will dump due to the institutions selling off) As expected. > Downvoters: So you want to buy Coinbase stock at over $200 a share on IPO day and be holding the bag when it drops when the founders, investors and employees start selling 10% of their shares? Sounds like a FOMO investor mindset to have. As expected. Typical pump and dump activity and another set of FOMO bag holders sitting at the $424 a share mark.
- therealmarv 6y agoWait... Is there no crypto token to invest in Coinbase directly?
- chrisked 6y agoUnfortunately not. Brain and Alesia addressed this in their AUS on Reddit. They thought hard about this and wanted to do it, but weren’t quite there yet.
- sn_master 6y agoCoinbase is the only exchange I know off that still supports sending coins to a private wallet in WA and NY. Localbitcoins and Kraken stopped supporting that, and RobinHood never did. It's a shame.
- dcposch 6y agoWait how does this work. If you can't withdraw then in what sense do you even own the coins? Does this mean that if you are, say, a New York based Robinhood customer, and you buy Bitcoin, then the only thing you can do with them is sell them later?
- ethbr0 6y agoI guess the analogy would be that you're actually holding a share in a Robinhood trust, the value of which is X bitcoin.
- georgyo 6y agoYes.
- sn_master 6y agoExactly! Robinhood doesn't and never allowed transferring in or out a wallet for any customers anywhere in the US, not just in some states like other exchanges. You can't even sell your coins at another exchange if the price is better there. With Robinhood and the like, you're only speculating on the value of the coin, which is very unhealthy for the market the as more of these 'exchanges' become common.
- rory 6y agoAfter not paying attention to cryptocurrency for a few years and then opening a Coinbase account earlier this year, I was SHOCKED how fast and easy everything was. From what I can discern as a user, they've made a great platform. My one worry-- it seems like they use a similar pattern to Robinhood where upon purchase they grant an asset immediately (synthetically?), and then settle up actual holdings after the fact. What kind of risk does that open them up to in an asset class as volatile as crypto?
- BenoitP 6y agoWas looking for the same kind of information. Do they publish proof of ownership of underlying assets? Or are they going naked for some amounts? Do they consider themselves as a bank, and vie for a 8% non-naked rate? In the MTGox days, the discrepancy could be viewed in the delay to take out one's coins; as well as in their market, which was displaying a very different prices than on other exchanges. Scary stuff I'm sure some HNers here will remember.
- throwaway192874 6y agoThere's a 1:1 backing of crypto funds, there is no fractional reserve stuff going on. But lots of internet people like to speculate there due to technical issues that happen from time to time. A delay to take out coins != a fractional reserve. Exchanges operate with hot wallets that have limited throughput, there's a ton of reasons that particular withdrawals may be delayed that don't have anything do with having those assets. One of the more common scenarios you would see is the hot wallet running low of funds, and there's a delay before more funds can be sent from cold storage to the hot wallet to service more transactions. If more people are taking crypto off of Coinbase than sending it in, the hot wallet trends downwards. If whales make large withdrawals, it can take a huge leap downwards. Funny antecdote, whales see significantly more delays than your typical consumer but are used to it and have some lines of communication to get insight if they have concerns. The process to move funds from cold to hot starts, but it's intentionally slow and takes time. So sometimes withdrawals can be delayed until that process completes.
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