How to Buy Coinbase Stock – Crypto Support
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If you are following the financial news recently, you’ve likely read about cryptocurrencies. Although it has been around for years, it is growing in popularity lately. One of the most popular cryptocurrencies is Bitcoin (BTC), but there are many others you can invest in. Since it is the oldest, it is also very popular.
With growing interest and investment in cryptocurrencies, there was a need for a trading platform that allowed investors to purchase and sell cryptocurrency. Coinbase is the largest cryptocurrency exchange in the United States, with a quarterly trading volume of $312 billion. It levies fees for depositing funds and trading, which is its primary source of revenue.
Are you looking to own a part of the company by investing in the stock? Here’s how you can go about it.
Related: A Beginner's Guide to Cryptocurrency
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Step 1: Finding a broker that offers Coinbase stock
The first step to investing in Coinbase stock is to look for online brokerages that offer the stock, which is easy. Finding a broker that allows you to buy the stock will not take long. Let us look at the investment platforms you can consider for buying Coinbase stock immediately.
Robinhood
A user-friendly platform and ideal for beginners, Robinhood is free to sign up, and you also get a share of stock after you complete the application. It offers premium features for $5 a month, including access to Morningstar research, which can aid in making better financial decisions. It supports cryptocurrencies and allows the purchase of fractional shares. The best feature of Robinhood is that the stock purchases are commission-free.
Pros and cons
Pros
- Perfect for beginners
- Supports cryptocurrencies
- Fractional shares
- Commission-free trades
Cons
- Does not offer bonds or mutual funds
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Stash
Stash is another great platform for beginners. You can easily start building a stock portfolio and invest in stocks, mutual funds, and ETFs. It has two fee options to choose from. You can start with the base for $3, including a $1,000 life insurance policy and debit card. Further, for $9, you can access everything, including custodial accounts and a monthly market insight report. Stash also offers fractional shares.
Pros and cons
Pros
- Offers fractional shares
- Custodial and retirement accounts available
- Good for beginners
Cons
- Not for experienced investors
M1 Finance
The best option for those in the stock market to buy and hold for the long term, M1 Finance allows you to customize the portfolio and build one with stocks, ETFs, and mutual funds. Remember, M1 Finance is not for those who are into buying and selling or for the newbies. The platform will not offer much support in terms of investment advice. Hence, you will have to make your own decisions. You can pick from individual, joint taxable, retirement, and trust accounts. Enjoy the premium version by paying $36 annually and getting a custodial account. It offers fractional shares, and all purchases are commission-free. There is a minimum of $100 for taxable accounts and $500 for retirement accounts.
Pros and cons
Pros
- Fractional shares
- Commission-free trades
Cons
- No investment advice or support
- No mutual funds
- High minimum account requirement
Step 2: Research Coinbase shares
Coinbase was founded by Fred Ersham and Brian Armstrong in 2012. It is a decentralized company that has become a focal point of the crypto economy. The company's mission is to build an open financial system through the power of digital assets. It is a remote-first company and has no physical headquarters. Coinbase has over 110 million users and $171 billion in assets on the platform.
It is in over 100 countries and has over 100,000 ecosystem partners. Its market cap is $51.68 billion, and investing in Coin stock is a chance to cash in on the crypto wave.
Wall Street highly anticipated its initial public offering (IPO). Coinbase debuted on the stock market through a direct listing in April 2021 on NASDAQ under the ticker symbol COIN.
Coinbase price history
The stock is trading around $210.45 as of May 9, 2024, a far cry from its all-time high of $429, as a market rout grips the crypto industry.
If you had invested $1,000 in April 2021, when the company went public, for $381 a share, you would have received close to 2 shares. In the initial months, it was trading at around $414, and you would have had an opportunity to make the most of the high. The stock value may have declined today, but it has the potential to grow in the future. The investment would be worth $552 today.
Coinbase dividend information
Coinbase does not pay any dividends. Although companies can make these decisions anytime, given the current market conditions, investors should not expect any dividend payout soon.
Best features of Coinbase Stock
When it comes to a cryptocurrency exchange, there is Coinbase and then everything else. The majority of Americans who are in the crypto market use Coinbase. Another popular platform is Binance.
Strong growth potential. The sentiment related to cryptocurrencies is currently positive, and in the long term, you may see an increase in investment. Many people are only aware of Bitcoin today, but with growing awareness about other types of cryptocurrencies, there is huge growth potential. The market is massive, and Coinbase has already made its presence felt here. It has played a significant role in making digital currencies accessible to the public, and when investors consider buying cryptocurrencies, the first thing that will come to mind is Coinbase. It will become the best exchange to gain exposure in expanding the crypto ecosystem.
Stable fundamentals. The company generated net revenue of $1.64 billion in the first quarter of 2024. Out of this, $935 million is in transaction revenue and $511 million is in services and subscription revenue. Coinbase looks well-positioned in the market today, and as it increases its product offering, it will continue to attract investors to the platform, generating revenue in the form of fees and subscriptions.
Growing user base. The awareness and importance of cryptocurrency are still growing, and the company will be able to make the most of the growth and adoption of technologies like the innovations in DeFi and NFTs. There is ample opportunity to benefit from the transformation, and Coinbase can benefit from its status as an important element of the financial infrastructure for the ecosystem. The company is expected to see continued user growth in the near future, which will drive organic growth for the business. As users grow and transactions increase, the revenue will rise.
Volatility drives the business. Interestingly, for Coinbase, the volatility is what drives the business. The up and down of Bitcoin and Ethereum will not matter; people buying and selling Bitcoin will generate revenue. Despite the competition, Coinbase has held a strong place in the U.S. crypto exchange market. With the recent bank run fears, investors may consider crypto a safer investment option, and beginners will only go to Coinbase for their investment.
Service and subscription revenue. The major revenue for Coinbase is the fees it earns on the trades, but it also generates revenue from non-trading activities, subscriptions, and service revenue. As the company rolls out ancillary services with time, it will see growth in the business.
Global expansion plans. It is a good sign when a company continues to expand despite the market turmoil. Coinbase is going global with new initiatives and has expanded in Singapore, Bahamas, Abu Dhabi, Brazil, and Canada.
New initiatives will drive highly stable and recurring revenue streams. For example, Coinbase allows you to earn free crypto in the rewards section. When you complete the educational content about cryptocurrencies, you get free crypto. Its other businesses include Coinbase Commerce, which provides retailers with software to accept cryptocurrency payments. Then there is the Coinbase card, which provides users with a Visa debit card to spend the cryptocurrencies by converting crypto into U.S. dollars.
Lastly, its cryptocurrency, USD Coin (USDC), is built on the Ethereum platform. The value of the coin is tied to the U.S. dollar. With these alternative sources of revenue, Coinbase has a long way to go, and it is offering unique solutions to invest in and use cryptocurrency.
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Related: Motley Fool Review
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Step 3: Open a brokerage account & buy Coinbase shares
You are now ready to open an account and invest in Coinbase stock. You can begin with a platform like Robinhood that also offers cryptocurrencies. Open the Robinhood website and click on Sign up.
You need to click “Claim your free stock now.” After you do so, you must provide your details, including your name, email, and password, to open an account. Once done, click on continue.
On the next page, you will have to provide further details like your birthdate, social security number, and citizenship status. Now, answer further questions about your experience in investing.
You must also provide details about your employment and whether you are a family member or a 10% shareholder of a traded company.
In the last step, you will have to fund the account. You can do it immediately by linking it to the bank account or doing it later. Purchase Coinbase stock after funding the account.
FAQs
How much were Coinbase shares when the company first went public?
Coinbase shares were priced at $381 in the direct listing in April 2021.
How much does it cost to buy Coinbase shares today?
It costs $210.45 to buy Coinbase stock as of May 9, 2024.
Does Coinbase pay dividends?
Coinbase does not pay cash dividends.
What is the minimum number of Coinbase shares that I can buy?
You can buy Coinbase shares in the form of fractional shares for as low as $1 but it depends on the brokerage you choose.
The bottom line
If you're hesitant about investing in cryptocurrencies directly but are still interested in the underlying technology, consider Coinbase, a platform integral to the cryptocurrency ecosystem. With its significant market potential and the burgeoning role of blockchain technology, Coinbase presents an attractive opportunity for growth in the coming months. As a company that recently went public, it captures the attention of retail investors and those involved in stock trading, offering a fresh investment avenue.
The option to buy either fractional shares or full shares adds to its appeal, catering to a diverse range of investors. However, it's important to acknowledge the inherent volatility of the stock market, especially in sectors closely tied to blockchain and cryptocurrencies. This volatility can lead to fluctuating stock prices, offering opportunities to buy during dips.
Investors should also be aware of the risks associated with regulatory changes and the nature of crypto assets. Despite these considerations, investing in Coinbase can be seen as a strategic long-term play, especially for those looking to tap into the cryptocurrency market without directly purchasing digital currencies. The company's valuation and role in the crypto space make it an intriguing option for those looking to diversify their portfolio with a stake in the evolving world of blockchain and digital currencies.
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Writer
Vandita Jadeja is a financial writer and editorial assistant at Joywallet. She loves to read and write about money and brings 7 years of experience from the financial industry. She loves coffee, mountains and sunsets.
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