In a momentous day for digital assets, Coinbase, a major digital asset exchange, custodian and forthcoming prime brokerage platform, went public through a direct listing.  Direct listings, as contrasted to initial public offerings, do not involve the creation of new shares—instead, outstanding shares are sold into the market by existing holders.  As reported by the New York Times, “Coinbase ended the day at $328.28, valuing the company at $85.7 billion counting all of its outstanding shares”.

This is the latest step in the maturation of the digital asset industry, which has been buttressed by increasingly high valuations of major cryptocurrencies.  At the same time, the cryptocurrency market continues to experience high volatility giving rise to questions regarding its suitability for retail investors.  However, given the established interest in digital assets from more traditional institutional investors and market participants, we expect to see digital asset service providers become more mainstream and further develop their offerings.