The biggest crypto-broker and all around one stop shop for crypto investors, Coinbase, is finalizing a deal with Tiger Global according to Recode.
They cite unnamed sources familiar with the matter which say $250 million may go towards new funds for Coinbase, while $250 million is to be allocated towards buying out existing investors.
Neither Coinbase nor Tiger Global have confirmed the above, with the latter being a big investment firm specializing in these sort of late stage deals.
Coinbase has apparently been looking to raise funds for much of this year, with the process seemingly slow, but they now appear to be close to closing the deal at a valuation of $8 billion.
That places Coinbase at the range it valued itself when it acquired the crypto start-up Earn which was bought for $100 million at a Coinbase valuation of $8 billion this April.
Analysts at the time were valuing Coinbase at $4.5-$6 billion, but since then Coinbase has considerably expanded, acquiring many licenses and start-ups in a buying spree.
The question now is when will they IPO, something which would make them the first crypto company to do so in US.
This rumored deal suggests not any time soon, with Coinbase potentially left another round of $1 billion plus in the coming years, after which they might have little choice but to go public.
They could do so through a SEC registered Initial Coin offering (ICO), as an alternative or perhaps in addition to an Initial Public Offering (IPO), but Coinbase has been very conservative, playing by the Silicon Valley rulebook, so an ICO appears very unlikely.
As it stands, Coinbase is now one of the most valued start-up in Silicon Valley, with Michael Novogratz, hedge fund manager at Fortress, holding Coinbase as a poster child.
“Here’s the poster child of the crypto space worth $8 billion — that’s a real company, and Tiger’s not a flake of an investor. These are smart, savvy guys,” Novogratz said at The Economist’s Finance Disrupted conference in Manhattan on Tuesday according to CNBC.
The crypto-broker and exchange has previously revealed they’re profitable, but the additional quarter of a billion dollars may allow them to expand their services further.
They recently announced they will be listing “most digital assets,” presumably to compete with Binance and the like, but they have been unable to offer margin trading or futures.
They briefly did so last year for wealthy individuals, but that didn’t go very well, with glitches briefly flash crashing prices.
Thus they stopped offering the service, focusing instead on institutional investors for custody and other crypto services, as well as on expanding crypto listings in addition to offering index fund like crypto bundles.