Coinbase hits $100 billion valuation mark in debut

IPO seen by some as an inflection point for digital currencies.

Coinbase made a rousing debut Wednesday on Wall Street, with the digital currency exchange’s stock rising as high as $429, briefly giving it a market value over $100 billion.

Coinbase Global’s initial public offering comes with cryptocurrency chatter seemingly everywhere, even at the Federal Reserve. Digital currencies are being incorporated into business plans and accepted by major corporations like Tesla, Paypal and Visa.

The San Francisco-based company’s listing on a public stock exchange (Nasdaq, ticker “COIN”) is seen by some as an inflection point for digital currencies, as Coinbase’s fortunes are closely tied to Bitcoin, the most popular cryptocurrency. Bitcoin’s price has topped $63,000, up from $29,000 at the start of the year.

Shares of Coinbase were trading around $376 after about 40 minutes of trading, putting its market value around $98.2 billion.

That market value makes Coinbase one of the biggest publicly traded U.S. companies: Just 83 companies in the S&P 500 index have market values above $100 billion. Coinbase’s value is greater than the combined market value of Nasdaq Inc. and Intercontinental Exchange, which owns the New York Stock Exchange.

Founded in 2012, Coinbase became popular among cryptocurrency fans by providing them with an easier way to exchange shares of Bitcoin and other digital currencies.

Coinbase earns 0.5% of the

value of every transaction that goes through its system. So if someone buys $100 in Bitcoin, Coinbase earns 50 cents. If Bitcoin or Etherium prices drop, the commissions Coinbase earns drop as well, giving it some exposure to the digital currencies’ rise and fall.

Instead of using a traditional IPO, Coinbase went public through a public listing. That means it avoided the typical agreements with big banks that would buy thousands of shares and promote them.

Not everyone is buying into the Coinbase hype. David Trainer, CEO of investment research firm New Constructs, said Coinbase has “little-to-no-chance of meeting the future profit expectations that are baked into its ridiculously high valuation.”

GABBY JONES/NEW YORK TIMES Coinbase employees join Wednesday at Times Square in New York for the company’s initial public offering. It’s the first major cryptocurrency startup to go public on a U.S. stock market.