ISWH in Focus: Upstart for the Next Wave in Crypto (COIN, MSTR, RIOT, MARA, SOS, HVBTF, CAN)
The Coinbase direct listing exposed the vulnerability of the massive run higher in risk bets ahead of the big COIN show. The stock opened for live trading right around the $381 level and took off like a shot. But the supply came in above $420 and put the top in for the day.
And, when COIN shares fell back under the $380 level, the bottom dropped out and the stock didn’t find support until touching $310.
However, its close in the $328 area still gives it a market cap above $85 billion. And the weakness may be attributed to the unique way it got onto the exchange — through direct listing rather than an IPO. The big difference: no restriction to selling shares for people on the inside.
Typically, that helps a new issue because long-time employees, founding share owners, and early-stage shareholders are keen to “exit” with their riches rather than allow the vicissitudes of the open market dictate their financial futures. Most of the time, there are lots of folks with life-changing wealth locked up for a nail-biting couple months post-IPO.
In this case, they were all able to cash in. And that’s just what they did. But that hardly suggests some sort of intel about the company’s future.
In addition, traditional Wall Street institutional investors don’t know how to build valuation projections for 1–3 years out for COIN. They just don’t have the metrics because it implies predicting the price of BTC and ETH, two of the most volatile markets ever to trade.