Coinbase Ipo is a digital currency exchange platform, went public on April 14, 2021, through a direct listing on the Nasdaq. The company’s IPO (Initial Public Offering) was highly anticipated, and investors were keen to see how the company would perform on the public market. While Coinbase is relatively new to the public market, it has been around for years, and its early investors include a significant number of young people. This essay explores the amount of profit the youth made in Coinbase’s IPO in 2020.
According to a report published by Coinbase, approximately 43% of its shareholders are millennials or younger. This suggests that a significant number of young people invested in the platform early on and held onto their investments as the company grew. As Coinbase’s IPO approached in 2020, many of these young investors were eager to participate in the public offering and reap the benefits of their early investment.
When Coinbase went public on April 14, 2021, its shares opened at $381 each. This was a significant increase from the reference price of $250 per share that was set by the Nasdaq before the IPO. The opening price valued Coinbase at over $100 billion, making it one of the most valuable public listings in history. Young investors who held onto their Coinbase shares from the early days until the IPO would have made significant profits from the surge in value.
For example, suppose a young investor purchased 100 shares of Coinbase at $10 per share in 2016, which would have cost $1,000 at the time. In that case, those shares would have been worth $38,100 at the opening price of the IPO in 2020. This represents a profit of over 3,710%, an extraordinary return on investment, given the short period.
It’s worth noting that not all young investors in Coinbase made significant profits from the IPO. Not everyone who invested in the platform early on held onto their shares until the IPO, and some may have sold their shares before the company went public. Additionally, some investors may not have purchased enough shares to make a significant profit, even if they held onto them until the IPO.
How Do African Youth Profit From Coinbase IPO?
The Coinbase IPO is expected to be one of the biggest IPOs of 2021, with a valuation of over $80 billion. The IPO is expected to have a significant impact on the crypto market and presents an opportunity for investors to make a profit. This essay explores how African youth can benefit from Coin base IPO and the overall cryptocurrency market.
Background: Coinbase is a leading cryptocurrency exchange platform that allows users to buy, sell, and store various cryptocurrencies such as Bitcoin, Ethereum, and Litecoin. Coinbase has over 56 million users globally and operates in over 100 countries, including Africa. The platform has been instrumental in creating awareness and promoting the adoption of cryptocurrencies in Africa, where financial inclusion remains a challenge.
Benefits of Coinbase IPO for African Youth: The Coin base IPO presents an opportunity for African youth to invest in the crypto market and potentially make a profit. By investing in Coinbase stock, African youth can participate in the growth of the company and the overall crypto market. The IPO will increase the visibility of cryptocurrencies, leading to increased adoption and usage in Africa.
Additionally, the Coinbase IPO is expected to have a positive impact on the cryptocurrency market, leading to an increase in the value of various cryptocurrencies. As a result, African youth who already hold cryptocurrencies such as Bitcoin and Ethereum will benefit from the increase in value.
Challenges: Investing in the crypto market, including Coin base IPO, comes with its own risks. The crypto market is highly volatile, and prices can fluctuate rapidly, leading to potential losses. African youth must be aware of these risks and invest only what they can afford to lose.
Moreover, investing in the Coin base IPO is not accessible to everyone, as it requires a significant amount of capital. African youth who do not have the necessary capital can still benefit from the cryptocurrency market by investing in other cryptocurrencies with a lower barrier to entry.
The Coin base IPO presents a unique opportunity for African youth to benefit from the growth of the crypto market. Investing in the IPO or other cryptocurrencies can potentially lead to significant profits, but it is essential to approach investment with caution and understanding of the risks involved. It is hoped that the Coin base IPO will lead to increased awareness, adoption, and usage of cryptocurrencies in Africa, ultimately contributing to financial inclusion and economic growth.
How Do Digital Currencies Contribute To Economic Development?
The emergence of digital currencies has brought about significant advancements in economic development. These virtual currencies, such as Bitcoin and Ethereum, have the potential to revolutionize the way transactions are conducted and create numerous opportunities for economic growth. This essay explores the various ways in which digital currencies contribute to economic development.
Firstly, digital currencies enable direct peer-to-peer transactions without the need for intermediaries, such as banks. This facilitates a more efficient and frictionless payment system, reducing transaction costs and increasing the speed of transactions. With lower costs and increased accessibility, digital currencies empower individuals in underserved regions to participate in the global economy, contributing to their economic development.
Moreover, digital currencies provide financial inclusion to the unbanked population. Traditional banking systems may be inaccessible to individuals in remote areas or with limited financial resources. In contrast, digital currencies allow anyone with internet access to store, send, and receive funds. This inclusivity empowers marginalized communities, giving them the means to participate in economic activities and improve their living standards.
Additionally, digital currencies create an avenue for investment and entrepreneurship. Initial Coin Offerings (ICOs) have emerged as a popular crowdfunding method, enabling startups to raise funds by offering digital tokens. This democratizes access to capital, allowing small-scale entrepreneurs to transform their innovative ideas into successful businesses. In turn, these ventures can contribute to economic development by generating employment opportunities and fostering technological advancements.
Furthermore, digital currencies can enhance cross-border transactions and international trade. Traditional banking mechanisms often involve multiple intermediaries and high transfer fees, hindering businesses’ ability to expand globally. Digital currencies eliminate these barriers, enabling seamless and secure transactions across different jurisdictions. This facilitates international trade, boosts export opportunities, and fosters economic growth.
Moreover, the blockchain technology underlying digital currencies has applications beyond the financial sector. Blockchain technology can enhance supply chain management by ensuring transparency and traceability. This can foster trust among consumers and businesses, leading to increased economic efficiency and productivity.
Additionally, digital currencies can promote financial innovation and the development of new business models. Smart contracts, powered by blockchain technology, enable self-executing agreements, eliminating the need for intermediaries. This opens up new opportunities for decentralized applications and peer-to-peer services, such as decentralized finance (DeFi), further contributing to economic growth and efficiency.
Furthermore, digital currencies can serve as a hedge against economic instability. Inflation, currency devaluation, and political instability can adversely affect traditional fiat currencies. Digital currencies, on the other hand, are decentralized and resilient to such uncertainties. They provide individuals and businesses with an alternative store of value, protecting their wealth and supporting economic stability.
Additionally, digital currencies encourage financial literacy and technological advancements. As individuals engage with digital currencies, they gain a deeper understanding of financial concepts and technological innovations. This knowledge can empower individuals to make informed financial decisions and participate more actively in the digital economy, fostering economic development.
Furthermore, governments can leverage digital currencies to enhance tax collection and combat illicit activities. Blockchain technology provides a transparent and auditable record of transactions, reducing tax evasion and money laundering. By embracing digital currencies, governments can enhance their fiscal capacity, thereby contributing to economic development.
Digital currencies contribute significantly to economic development in multiple ways. They provide faster and cheaper transactional systems, financial inclusion to the unbanked, opportunities for investment and entrepreneurship, enhanced cross-border transactions, supply chain transparency, financial innovation, protection against economic instability, financial literacy, and improved tax collection. As digital currencies continue to evolve, their impact on economic development will likely continue to grow, making them a vital component of the future global economy.
Conclusion on Digital Currencies
In African Economies the question of digital currencies has not been that active with the exception of only a few countries. However, for African countries this will be a matter of discussion in the future and so now, we conclude the matter.
In conclusion, young investors who invested in Coinbase early on and held onto their shares until the IPO in 2020 would have made significant profits. With 43% of the company’s shareholders being millennials or younger, it’s safe to say that many young people participated in the public offering and benefited from the surge in value. While not all young investors made huge profits, the success of Coinbase’s IPO highlights the potential for young people to make wise investment decisions and reap the rewards of their foresight.
Coinbase. (2021). Coinbase S-1. Retrieved from https://www.sec.gov/Archives/edgar/data/1679788/000162828021003358/coinbaseglobalincs-1.htm
Akinwale, A. (2021). Coinbase IPO: what you need to know as it goes public. The Guardian. https://www.theguardian.com/technology/2021/apr/14/coinbase-ipo-what-you-need-to-know-as-it-goes-public
Coinbase. (n.d.). About Coinbase. Retrieved May 20, 2021, from https://www.coinbase.com/about
Ogunde, A. (2021). Coinbase IPO: What African investors need to know. The Africa Report. https://www.theafricareport.com/75319/coinbase-ipo-what-african-investors-need-to-know/