COIN Banega Crorepati

Good morning,

It’s Zaheer. Coinbase, the world’s second-largest cryptocurrency exchange, went public on the Nasdaq this week. Not bad going for a company that began life in a loft and deals in what John Oliver once described as “everything you don’t understand about money, combined with everything you don’t understand about computers”.

Coinbase drags crypto into the mainstream


In September 2017, Bloomberg reported that Jamie Dimon, then chief executive of JPMorgan Chase & Co, called Bitcoin a “fraud” and said he would fire any employee trading it for being “stupid”.

Earlier this week, Coinbase, the largest cryptocurrency exchange in the US, went public with a direct listing* on the Nasdaq.

Its advisors for the listing included Citigroup and — you guessed it — JPMorgan.

*A direct listing is like an IPO, except that the company just wants to be publicly traded and isn’t seeking to raise cash. With an IPO, a company partners with financial institutions to promote its stock with the hope of selling shares to raise capital. A direct listing, on the other hand, lets existing stakeholders sell shares to the public.

To his credit, Dimon later said he regretted his words, but crypto’s meteoric rise, over the past 12 months especially, has surprised not just the sceptics but many die-hards as well.

A historic listing

On Wednesday morning, Coinbase appeared on the Nasdaq under the ticker “COIN” and a starting reference price of $250.

Within hours, its stock price touched $429.54, giving it a valuation of around $112 billion. It then slowly declined to close at $328.28, well above the $250 reference price, for a valuation of $85.8 billion.

This chunk of change made a lot of people a lot of money. It meant that Surojit Chatterjee, an IIT graduate who left Google to become Coinbase’s chief product officer last year, is now worth $646 million, or about Rs 5,000 crore, according to data compiled by Bloomberg.

But what exactly is Coinbase, why has there been so much hype around it, and what does its listing mean for the future of crypto?

What is Coinbase?

At its core, Coinbase is a platform that lets you buy and sell cryptocurrencies, and convert one cryptocurrency to another. Its app resembles those of digital stock brokers such as Zerodha and Upstox, providing current prices and trends for crypto assets and a summary of your portfolio.

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The company was founded in a loft in San Francisco in 2012, when Bitcoin was just three years old, by former Airbnb engineer Brian Armstrong and former Goldman Sachs trader Fred Ehrsman.

Why the hype?

Coinbase isn’t the first crypto exchange to go public but it’s by far the largest. Its $85.8 billion valuation on Wednesday placed it above many traditional finance companies and even the Nasdaq itself.

Today, about 56 million people have Coinbase accounts and use them to trade more than 50 cryptocurrencies and various other crypto assets such as NFTs (read our explainer on NFTs here).

Coinbase IPO

The total value of crypto assets on Coinbase accounts for 11.3% of the entire crypto market capitalisation, which crossed $2 trillion a fortnight ago. You might think of it as the Google of crypto.

The company generated $1.28 billion in revenue last year. It has already made $1.8 billion in the first three months of 2021, an 844% jump from the $190.6 million it generated in the first three months of 2020.

The not-so-secret sauce

While the company has had its share of lucky breaks, Coinbase’s rise has been no fluke.

Armstrong and Ehrsman were clear about their mission from the start: to make cryptocurrency accessible to the masses.

When Andreessen Horowitz led an investment in Coinbase, Chris Dixon, a partner in the fund, said Coinbase’s technology was “as if Google made Gmail for Bitcoin.”

Coinbase’s main strengths are its simplicity and the fact that it works like a real bank, accepting funds via bank transfers and storing assets (digital keys to unlock crypto tokens) in safes.

It’s also secured like a bank. The company’s huge security department includes both an Iraq war veteran and a PhD in cryptography.

Its website, also reminiscent of Google’s in its simplicity, has a centralised hub for users to trade crypto assets among themselves or buy currencies directly from Coinbase.

To keep things simple, manageable and safe, Coinbase allows users to trade only a few (about 50) of the more than 5,000 cryptocurrencies that exist. Choosing quality over quantity and ignoring the critics has paid off handsomely — cryptocurrencies listed on the platform typically see their value surge in days.

Crypto folk call this the “Coinbase effect”.

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The future

Coinbase’s goal is to do for cryptocurrency what Google did for the world wide web in the late ’90s — bring it to a wider audience through fanatical simplicity.

For this, it has had to eschew crypto diehards for whom the idea of a centralised crypto platform — not to mention dealing with Wall Street suits — is anathema.

Crypto exchange Coinbase may list at valuation more than NY stock exchange today

Its founders have also made a strategic decision to tone down anti-establishment rhetoric and work with regulators, recognising that taking crypto to the masses comes with some unavoidable costs.

Despite these compromises, Armstrong is clear about his vision for cryptocurrencies: “I don’t think crypto is here to solve every problem in the world. But it’s here to solve one very important meta-challenge, which is economic freedom,” he recently told the Wall Street Journal.

Let me now pass it on to Vikas SN for other big developments of the week


E-commerce platforms are witnessing a deja vu moment as state governments announce a series of ambiguous measures to tackle the rapid surge in Covid-19 cases.


GIF Credit: Tenor

In Maharashtra, only ‘essential goods’ can be delivered in the state until May 1 while Haryana has allowed e-commerce supplies of essential items during the night curfew hours. In Madhya Pradesh, lockdown restrictions have limited all e-commerce deliveries except so-called essential products while it is completely shut in the neighbouring Chhattisgarh.

India’s top e-commerce executives said these notifications lack clarity on what constitutes ‘essential goods and services’, leading to various interpretations by field-level enforcement authorities, including the police. This has led to senior e-commerce executives engaging with top state government officials in a bid to explain the implications of their orders.

This is crucial for online retail firms since products such as smartphones, fashion, electronics, large appliances and furniture, all of which fall under the non-essentials category, drive the bulk of their sales. In terms of demand, industry executives said they are currently witnessing a cautious uptick, but is nowhere near the meteoric rise witnessed last year.

That said, food delivery apps like Swiggy and Zomato did get some respite after Mumbai Police clarified these apps can operate after 8:00 pm when the night curfew is in force.


  • SoftBank Vision Fund is finalising a $450-million investment in food delivery startup Swiggy, that could value the firm at $5 billion prior to the investment. The financing will be an extension of the $800-million round that Swiggy co-founder Sriharsha Majety announced in an internal email earlier this month, sources told ET. This will be SoftBank’s first bet in the sector after more than three years of flirting with both Swiggy and IPO-bound Zomato.
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Food Feud

  • Private equity investors Multiples Alternate Asset Management, Premji Invest and Goldman Sachs are looking to invest a combined $150-200 million in the meat and seafood brand Licious at a post-money valuation of $800 million, people close to the development told ET. The round is expected to see a fresh issue of shares as well as some early backers selling part of their stake.

deals digest


  • As Nykaa prepares to go public later this year, seeking a valuation of around $3.5 billion, ET collaborated with data platform Tracxn to take a closer look at how its valuation has risen and its cap table has evolved over the years.

Nykaa rise graphic

  • With a lot of startups in India heading for an IPO, founders will have to wade into an unfamiliar talent hunt that could help them chart their public company journey. Among those who command a big premium are experienced CFOs, and investor relations managers, say executive search firms.

Also Read: How Zomato’s cap table has evolved


NPCI’s move is aimed at moderating volumes on the UPI payment channel, which has been plagued by banking outages and technical declines of late.
France’s copyright regulation should be the case for all of Europe since the copyright directive is really important, said European Union’s Competition Chief Margrethe Vestager in an exclusive interview.

Google Pay PhonePe

Google Pay is learnt to be reassessing its customer engagement initiatives to bring its UPI market share to below 30%, while PhonePe said it will not stop aggressive marketing for at least a year.
Bitclout, the world’s first blockchain-based crypto social network, lets users invest in the social clout of the rich and famous by buying their unique crypto token.Meesho wants to diversify its business model to target 100 million small businesses, a hitherto untapped yet lucrative segment for e-commerce in India.

That’s about it from us this week. Have a great weekend!



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