How to Buy Coinbase Stock
Last Updated: January 11, 2023
In the past, there was a belief in what a public company is supposed to look like. People imagined these companies as old-school industrial titans, with headquarters visible on the New York City skyline.
People who held these beliefs just a couple of years ago are now googling “how to buy Coinbase stock.”
So, how did we get here?
How did it come to be that the company specializing in cryptocurrency trade peaks such public interest from traders and investors alike?
When did it become possible for a company that doesn’t even have physical headquarters to be traded on Nasdaq and valued in hundreds of millions of dollars?
After all, in early April 2021, ‘how to buy Coinbase IPO’ became one of the most frequently used financial questions asked on Google.
So, for all those who are interested in learning more about this investment market anomaly that is Coinbase, as well as learning how to invest in it themselves, here’s a brief rundown.
Coinbase is a cryptocurrency exchange founded in 2012 by current owners Brian Armstrong and Fred Ehrsam. It’s one of the most popular places to trade Bitcoin, Ethereum, Litecoin, etc. The combination of the platform’s optimization and the growing value of cryptocurrencies is what makes the biggest difference in its business model and success.
In April 2021, the company launched a direct listing (DPO) on Nasdaq. Since then, the Coinbase ticker symbol (COIN) has been a popular search.
Coinbase going public was such a milestone because it was the first pure-play crypto trading company to ever list on a US exchange. Also, unlike most other publicly traded companies, Coinbase is remote-first. This means that it lacks physical headquarters. Needless to say, such a thing is quite uncommon for a company of this size and value.
Should You Buy Coinbase Stock?
While 100% accurate Coinbase stock price prediction is impossible (like with any other stock), understanding the factors that affect it already gives you a competitive edge. This can help you figure out when to sell stocks and when is the time to buy.
Essentially, the value of Coinbase stock is greatly tied to the value of cryptocurrencies.
Some argue that, regardless of the cryptocurrency volatility, people will still trade in them, and thus, the exchanges will still make money. However, the COIN stock price will always be affected by the value of the crypto for several reasons.
- The platform makes more profit in fees when prices are higher.
- Since it makes money on the fees and spread, the more volatile its tradable assets are, the bigger its transaction-based income will be.
- The company itself has a large holding in crypto. In other words, they’re not making money from the trading volume exclusively.
Due to the three reasons listed above, it’s safe to assume that the value of Coinbase stock is always going to be closely tied to the cryptocurrency market. During periods of high cryptocurrency volatility, Coinbase shares will rise. And if there’s one thing you can depend on cryptocurrencies to be, it’s – volatile.
Coinbase stock performance
The Coinbase IPO price was $328.28 at the end of the first day of trading. Since an initial estimate on April 13 (one day before going public) was at $250 per share, this was an above-average performance of the stock. Still, since the daily high was at $425, it was also seen as somewhat of an early drop.
When compared to the first few days after the launch, the value of the stock has dropped significantly. Since June 2021, the Coinbase share price has moved between around $220 and $280. Still, since prices are dynamic and change throughout the day, following the ticker symbol might be a good idea.
However, what does this mean for your portfolio?
One of the first questions that everyone asks is about the dividends. Here, the things are fairly straightforward – Coinbase doesn’t pay cash dividends, and there are no plans for this to change in the future.
Yet, those who are looking to diversify their portfolio might find Coinbase to be a unique opportunity. As we’ve already mentioned, its performance is not just based on the crypto value but also on the market’s volatility. Technically, a drop in cryptocurrency’s value may cause a sell-craze (which would also go through the trading platform). In other words, it’s a solid portfolio diversifying plan for crypto investors.
How to Invest in Coinbase?
Even when you finally decide to invest in Coinbase, determination alone is not enough. You need to understand your stock purchase options. Here’s a brief rundown.
The first you need in order to buy any stock is a reliable platform. Each of them offers different account management, fees, insurances, and regulations that can impact your trading experience. So, you need to make a quick comparison. Read a couple of reviews like those of Fidelity or Interactive Brokers and visit their websites. This will help you figure out which of these trading sites offers you the most.
Next, you need to open your brokerage account and confirm your payment details.
Even if you know enough to buy Coinbase stock immediately, it’s always a good idea to repeat your research before executing your order.
Also, based on your previous trading experience or expert opinions, you need to try and figure out if now is the right time to buy.
That’s it, from this point on, you either purchase or decide to wait some more. You also check in on your investment (or potential investment) every now and again.
How to buy Coinbase IPO?
The short answer is – you can’t! Not anymore, at least.
Seeing as how Coinbase went public on April 14, 2021, buying it is no longer an option.
Essentially, purchasing an IPO stock is more a matter of timing than anything else. The thing is that you often can’t do it through the regular channels. While IPOs are not restricted to organizations, this option requires you to have a well-developed relationship with the management early on, which is something that will lock out a lot of investors.
Buying Coinbase IPO was also possible in the pre-market purchase, but this option too was available only to professional investors. Seeing as how they required privileged status, these transactions were usually measured in millions of dollars.
Figuring out how to buy Coinbase stock on the Nasdaq is a relatively simple process. All you have to do is find the right trading platform, register, and learn how to use it.
A much bigger question is whether you should be investing in COIN, to begin with. Sure, Coinbase is something revolutionary and completely different from most publicly traded companies. But seeing as how this industry might get some heavy regulation in the near future, the prospects might not look so bright.
The value of the stock is closely tied to the volatility of the cryptocurrency market, which is a fairly reliable bet. Still, as of September 2021, the shares are changing hands at around 40%-50% of their all-time high. Sure, the Coinbase IPO price was quite impressive, but since you can’t buy retroactively, it shouldn’t be that much of a factor in your decision-making process.
As of today, it might be best just to find a reliable trading platform, do some research, and monitor COIN until a better time to buy comes.
As of mid-September 2021, Coinbase is not at its buy point. But according to analysts, the platform is a crucial part of the crypto ecosystem. With the ongoing cryptocurrency adoption and growing interest in digital coin trading, demand for the stock is set to rise.
Coinbase went public on April 14, 2021, via a direct listing. Since then, the company can be found on the Nasdaq under the COIN ticker symbol.
Yes. And if you want to join the hype and become an investor, refer to our “How to buy Coinbase stock” guide above.