In brief

  • Coinbase posted its S-1 filing on Thursday morning, revealing its financial details.
  • The crypto giant saw $322 million in 2020 profit thanks to Bitcoin's bull run during the pandemic.
  • Coinbase's direct listing will be a major symbolic moment for the entire crypto industry.

The recent Bitcoin bull run helped Coinbase pull in a profit of $322 million on revenues of over $1.2 billion in 2020, putting the cryptocurrency giant in a strong position as it prepares to sell its shares to the public in its upcoming direct listing on the Nasdaq.

The figures, disclosed in an S-1 regulatory filing, give the first detailed look at the financial performance of Coinbase, which launched in 2012 as a user-friendly way for consumers to buy Bitcoin, but which has since added a professional trading platform and a variety of banking-like services for the burgeoning cryptocurrency industry. Coinbase says it has seen $456 billion in lifetime trading volume on its platform.

The company first disclosed its intent to go public in December.

Coinbase's 2020 profit of $322 million compares to a loss of $30 million in 2019, and its 2020 revenue jumped 140% from the $533 million it earned in 2019.


The jump is not surprising given that Coinbase earns the bulk of its revenue on trading commissions, and that interest in cryptocurrencies surged late last year as the price of Bitcoin rose from around $10,000 in September to over $30,000 by the end of the year. Bitcoin is currently trading around $50,000.

In a letter to investors, Coinbase founder and CEO Brian Armstrong said: "Coinbase is a company with an ambitious vision: to create more economic freedom for every person and business. Everyone deserves access to financial services that can help empower them to create a better life for themselves and their family, but today we're a long way from that vision."

Coinbase, which has recently been valued at $100 billion, is one of the most hotly anticipated public offerings of 2021. And like other buzzy Silicon Valley unicorn offerings such as Palantir, Spotify, and Slack, Coinbase has chosen to forego the traditional IPO process in favor of a direct listing—a process that allows firms to float their shares directly on the market, instead of Wall Street banks lining up underwriters and setting an opening price.

Until recently, companies that chose to list directly could not float new shares, only sell existing ones. But a December order by the SEC changed that rule such that firms can issue new shares through direct issues, increasing the potential amount of money they can raise.


In the case of Coinbase, the company's share prices have been trading around $300 on private exchanges. That could be a key clue in determining what price Coinbase chooses for its debut, though a person close to the company says this will not be the only factor in the pricing decision.

In the risks section of its S-1 filing, Coinbase pointed to cryptocurrency's volatility, its reputation risk, and the prospect of another "crypto winter"—industry slang for prolonged downturns in which prices tumble and trading volume collapses.

Biggest shareholders

Thursday's filing reveals that venture capitalist Marc Andreessen owns the most common stock in Coinbase with over 5.5 million shares, followed by Armstrong, who has over 2.7 million shares. Armstrong retains a 21.8% voting stake, while his co-founder Fred Ehrsam has a 9% voting stake, with Andreessen controlling 14.2% and another early investor, Fred Wilson, having an 8.2% voting share. An 11-member group of executives and board members will together exercise 54% voting control.

And in a nod to Bitcoin's pseudonymous co-founder, the front page of the filing states that a copy of it will be sent to the Bitcoin wallet address of Satoshi Nakamoto.

The filing also reveals that Coinbase has 43 million "verified" users, and 2.8 million monthly active users.

Major milestone for the crypto industry

The arrival to the public markets of Coinbase, which will list under the ticker symbol COIN, is not only a milestone for the company and its co-founders, but for the cryptocurrency industry as a whole. A high valuation for Coinbase when it hits the public markets will provide an important benchmark as investors look to put a price tag on a raft of other crypto companies, including exchanges and storage providers.

It will also be an important symbolic moment for the crypto industry.

For years, governments and law enforcement agencies have stigmatized cryptocurrency as little more than a tool for criminals and hucksters, while pillars of the financial establishment—including Warren Buffett and JP Morgan CEO Jamie Dimon—ridiculed it as "rat poison" and worse. But such perceptions have shifted remarkably in the last two years, in no small part thanks to Coinbase, which has forged banking relationships with Goldman Sachs and JP Morgan, and helped companies like Tesla make major Bitcoin purchases.


Coinbase's public listing will mark another major moment in crypto's evolution towards mainstream maturity and respectability.

This story is being updated with more details. 

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