Do you want direct exposure to the crypto market without necessarily investing in cryptocurrency? Now is an awesome time to invest in Coinbase stock. In today’s guide, we will give you some important facts about the leading crypto exchange Coinbase. We will also explain how you can seamlessly buy Coinbase stock. Not just that, we will also use the opportunity to highlight the best broker where you can buy Coinbase stock.
But before we delve into all the details, let’s start with an overview of Coinbase.
What is Coinbase: A brief overview
Coinbase is one of the leading crypto exchanges out there. The company was launched in 2012 by Brian Armstrong and Fred Ehrsam. When the company kicked off operations in 2012, it became the go-to platform for crypto enthusiasts who want a secure place for buying and selling bitcoin.
While Coinbase started off by supporting Bitcoin, it has expanded its crypto listing, supporting some of the top digital assets in the crypto space.
Coinbase operates as a distributed company. What this means is that the company has no physical headquarters so employees of the company work remotely.
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Cryptocurrency assets are volatile in nature. Buy and trade at your own risk.
Trading with financial instruments carries high level of risks that is not suitable for all investors. Before making any investment decisions, you should seek advice from independent financial advisor to ensure you understand the risks involved.
Trading with financial instruments carries high level of risks that is not suitable for all investors. Before making any investment decisions, you should seek advice from independent financial advisor to ensure you understand the risks involved.
The crypto platform has a presence in over 100 countries and boasts millions of users. In terms of trade volume, Coinbase estimates that users trade roughly $159 per quarter. Much of the company’s revenue comes from transaction fees charges on trades executed on the platform.
Latest stats suggest that Coinbase has over 108 million verified users, making them one of the most used crypto exchanges. It is important to add that Coinbase’s fortunes changed significantly between 2018 and 2022, following a bullish market that saw several digital assets print new all-time highs.
When did Coinbase go public?
Coinbase went public in April 2021, a move that has changed the fortunes of the crypto industry significantly. The company pulled off a chess move by deliberately avoiding the traditional IPO process. Instead of opting for the traditional IPO process, Coinbase decided to list its stock directly, making it possible for employees of the company and existing shareholders to sell their shares directly on the open market.
Following a successful direct listing, Coinbase joined the ranks of tech giants, Slack and Spotify who took a similar approach to their IPOs.
It’s important to add at this point that Coinbase was the first crypto business to go public in the U.S. When the company went public, its share opened at $381 on the Nasdaq exchange, pushing the entire crypto market cap to well over $100 billion dollars.
How has Coinbase stock fared?
While crypto giant Coinbase had one of the best public listings of all time, the company has seen its fortune plunge significantly since then. Since November of 2022, Coinbase stock has seen its value plummet by over 88% following a prolonged bearish winter that has continued to pommel crypto prices.
Despite sustained selling pressure that has seen COIN shed off much of the gains made following its public listing, experts believe that Coinbase is still a solid company to invest in.
What would an investment of $1000 in Coinbase IPO return?
Even though Coinbase went public on April 14, 2021, following a direct listing, investors had to patiently wait for the shares to open before they jumped in. When Coinbase launched its IPO, it had a reference price of $250. However, the company’s stock opened significantly higher at $381. Shares would trade to over $425 on the day before closing at $328.28.
A $1,000 investment during Coinbase IPO, would have seen an investor buy 2.66 shares of the company stock as the price per share opened at $381. Despite rallying to $425 on the day, COIN price has continued to plummet.
Those who made any significant profit from Coinbase stock are those who sold at the top. Assuming you didn’t sell your stock and still holding till now, your 2.62 shares would be worth $92.98 today based on a price of $35.49 per share as of the time of writing. This represents a loss of nearly 92% over the last 22 months.
Is this a good time to buy Coinbase stock?
It’s been a not-so-cool end-of-year experience for Coinbase. The continuing crypto winter alongside the fallout from the FTX meltdown has forced many investors to dump Coinbase shares. A look at Coinbase’s performance this year shows that the company’s stock is 82% down year to date, plunging the company’s valuation to below $10 billion. In the last two weeks, Coinbase stock has continued to print new all-time lows.
Despite being on the back foot for much of the year, there is a strong case to be made that Coinbase stock is now significantly undervalued by investors. Even though the FUD in the marketplace has contributed to the poor performance of Coinbase stock, there is still a contrarian case for investing in Coinbase.
As we reiterated earlier, much of Coinbase’s woes is because of the sustained selling pressure in the crypto market. So if the market were to rebound, we expect Coinbase stock to pick up momentum.
Another case for investing in Coinbase right now is that it is significantly undervalued and we expect the price to skyrocket with a resurgence of the crypto space.
If you missed out on Coinbase stock when it went public in 2021 because of its insane valuation, now is an awesome time to pick Coinbase stock at a remarkably low price.
How to buy Coinbase stock
Having given you an overview of Coinbase and how the company’s stock has performed recently, it’s time to jump into the part you have been waiting for: how to buy Coinbase stock online. Surprisingly, the process is super easy. Let’s jump right in, shall we?
Step 1: Choose a Brokerage
To invest in Coinbase shares or any other stock, you’ll need to register with a brokerage. For times immemorial, brokers have continued to serve as intermediaries between yourself and the stock market. Brokerage firms help you execute your trades, whether buying or selling. With brokers, you have the option to invest for long-term goals such as retirement or aim for a quick profit.
Speaking about brokers, there is a wide selection of brokers available out there you can confidently do business with. That said, when choosing a broker, you want to end up with one that offers low fees and investment minimums. With such a broker, you can start investing right away.
While there are many brokers out there, one we highly recommend is eToro, which is because of its unique proposition.
Step 2: Open an Account
Once you have made up your mind on the broker to use, the next thing you want to do is open an account. Keep in mind that brokers usually offer different account options, so make sure you know exactly what you are looking for. Some of the leading brokers we have explored offer several account options, including retirement accounts, 529 plans, which is great for saving for college, and taxable brokerage accounts. Let’s look closely at each account type.
- Retirement accounts: Opening an individual retirement account (IRA) comes with many significant benefits, including tax advantages. Notwithstanding, IRAs have one significant limitation. If you decide to withdraw your money before you are at least 59½, you’ll incur a 10% penalty fee along with income taxes.
- Taxable accounts: Although taxable brokerage accounts may not come with any tax benefits, they have their unique advantages. To start with, having this type of account means you can withdraw your funds anytime without incurring any type of penalty. So if you want some flexibility with your investment, it’s best to open a taxable account.
Step 3: Research Coinbase
Before putting your hard-earned money into Coinbase or any other company’s stock, it’s important you do your due diligence. If you want to buy Coinbase stock, it’s important you know a thing or two about the company’s fundamentals. You also want to make sure that the company has a business model that will succeed.
Like all publicly traded companies, Coinbase is required to file its financial statements with the U.S Securities and Exchange Commission (SEC). To view Coinbase ’s annual reports and quarterly financial statements, you can visit its investor relations sites.
When perusing these documents, you want to focus on these factors. This will help you decide how much money to invest in Coinbase stock.
Volatility: Coinbase ’s stock value has fluctuated significantly in the last couple of years. In 2021, the company’s stock price reached as high as $425. But in March 2022, it fell to as low as $100. In its annual report, the company cautioned that the volatility of its stock is due to factors beyond its control.
Price per share: Coinbase shares aren’t as expensive on a per-share basis, especially compared to other high-flying tech stocks. More so, some brokers allow investors to purchase fractional shares. This simply means that you can buy bits of a single stock instead of investing large sums into buying a single stock of a company. With brokers like eToro that support fractional shares, you can adopt strategies like dollar cost averaging to grow your investment.
Note: These factors listed above play a significant role in influencing Coinbase ’s value.
Step 4: Place an Order
If you decide to buy Coinbase stock, all you need to do is open your trading account and enter Coinbase ’s ticker symbol, COIN. After that, you’ll need to choose how many shares you wish to purchase. If your broker supports fractional share investment, you can enter the dollar amount you would like to invest instead.
When buying Coinbase shares, you can use either a limit order or a market order. If you opt for market orders, your trade will be executed as per the current value of Coinbase stock. On the flip side, if you opt for a limit order, your broker will only execute your trade if the price reaches the price you set. Usually, limit orders are great if you expect the price of Coinbase shares to drop sometime in the near future.
Step 5 Monitor COIN’s Performance
Even if your plan is to hold Coinbase stock for the long term, it’s always a brilliant move as an investor to review the performance of your stock from time to time. You can always compare its performance to popular stock indexes like S&P 500. This way, you know how it is measuring up.
If you have multiple investment accounts with different brokerages, you can always use an investment portfolio app to keep track of your investment from one place.
Step 6: Have an exit plan
Whether you intend to hold onto your Coinbase shares for a few years or a few decades, there will come a time when you decide to sell your shares.
As with purchasing stock, you can sell your shares by entering your broker’s platform and typing in the ticker symbol and the amount you want to sell. You can sell at its current price, or you can place an order to sell only when the stock reaches a certain price.
If your investment earns a profit, you may owe capital gains taxes, so consider talking with a tax professional about how to plan for those taxes before placing any sale orders.
How to buy Coinbase stock on eToro
Now that you know how to invest in Coinbase stock, we want to use this opportunity to show you how you can buy Coinbase shares on an exchange like eToro. And just so you know, the process is pretty straightforward and only takes a couple of minutes. Here, check out how anyone can buy Coinbase stock on eToro.
Create an eToro account
If you don’t already have an account with eToro, you’d have to open one to be able to buy Coinbase stock. As we reiterated earlier, the process is simple. If you already have an account with eToro, you can simply log in.
During the signup process, you’ll be required to provide basic information like name, email address, and phone number. Nonetheless, to fund your eToro trading account, you’ll need to provide additional info so the broker can verify your identity.
Complete your eToro profile
If you’re opening your account for the first time on eToro, you’d be required to complete your profile. For customers who have an existing account, you can skip this process. Completing your profile only takes a couple of minutes and is a requirement by most brokers as per AML and CTF regulations. With your profile now complete, you can proceed to other aspects.
Fund your trading account
After completing your eToro profile, you’ll need to fund your trading account to be able to buy some Coinbase Stocks. We love eToro because they have a low minimum deposit requirement. To start trading on the eToro platform, you’ll need to make a minimum deposit of $200 or it’s equivalent in other currencies.
And just to add, eToro supports up to 8 popular deposit methods, including PayPal, wire transfer, UnionPay, credit or debit cards, Neteller, Skrill, and WebMoney. So, funding your account is super easy.
Tip: If you’re not fully convinced or you don’t feel ready to invest real money, you can test the waters with eToro’s virtual portfolio feature. This option lets you trade your favorite stocks without putting in real money. And as you gain experience and feel more comfortable, you can switch to a real portfolio.
Buy Coinbase Stock
With your eToro account now funded, you can proceed to buy Coinbase stocks. While eToro lets you buy Coinbase shares seamlessly, you can also decide to short it. Keep in mind that the direction you decide to take is based on current market sentiments or direction. Here is how you can buy Coinbase stock on eToro.
Navigate to eToro’s unique search bar, which sits at the top of the screen. Enter the ticker name associated with Coinbase stocks: COIN. Hit the trade now button to place your order. A new window should pop up, allowing you to make changes to different parameters. It’s that easy.
