Coinbase Listing Draws Valuations From $19B to $230B

In a sign of the extreme range of opinions on cryptocurrencies, not to mention the uncertainty and risk of investing in the 12-year-old industry, analysts are estimating values for next week’s Coinbase stock listing at anywhere from $230 billion to one-twelfth that amount.

New Constructs, an investment research firm, estimates the U.S. cryptocurrency exchange’s valuation should be closer to $18.9 billion. Delphi Digital, a digital asset research firm, calculates a Coinbase valuation between $160 billion and $230 billion if the stock can command above-average price multiples. Earlier this week, the brokerage firm DA Davidson estimated the market cap at $90 billion.

Coinbase’s direct listing will trade on the Nasdaq exchange under the ticker COIN on April 14, and the event is increasingly seen as a watershed moment for the fast-moving industry.

One crypto exchange, FTX, has even tried to capitalize on the speculative fervor around the Coinbase stock debut by listing a “pre-IPO contract” designed to allow market participants to bet on the initial share price. It’s up about 16% for the month to date to a value of $499, implying a valuation of around $103 billion, assuming an estimated 266.2 million shares outstanding.

According to the New Constructs report, however, Coinbase “has little-to-no-chance of meeting the future profit expectations that are baked into its ridiculously high expected valuation of $100 billion.”

According to New Constructs, Coinbase would need to produce compounded annual revenue growth of 50% over the next seven years. Yet, Nasdaq’s greatest 10-year revenue growth rate was just 21%.

Assuming a rate of 21% and slight profit-margin compression, COIN shares would be worth just $18.9 billion, the report argues.

UPDATE (April 9, 21:36 UTC): Corrects the number of outstanding shares from 206 million to 266.2 million.