Coinbase from YC to DPO • Hacker News Board

Re: Coinbase from YC to DPO

#411

Post by fernandopj » Wed, Apr 14, 2021, 8:13 PM UTC

ilyaeck wrote: post #301

bglusman wrote: post #278

It's a tiny bit pedantic, but the Coinbase offering today was not actually an IPO, I learned, but a DPO (Direct Public Offering). It was not a fundraising event for Coinbase, only a liquidity event for shareholders, and unlike an IPO no explicit valuation process occurred to select an offering price.

What difference does it make? Shares trading openly on the market is as explicit a valuation process as it gets.

The basic difference:

In an IPO the company puts private shares in the open market and gets money from it, priced at the IPO price. Whoever has (private) shares now has public shares and can trade whenever they want.

In a Direct Listing the company often already traded shares "openly" but not in a "public" way, but now wants it listed publicly so retail investors can trade it, and there's no immediate need of capital so the objective isn't to get a funding from offering shares in an IPO.

Re: Coinbase from YC to DPO

#412

Post by bosswipe » Wed, Apr 14, 2021, 8:13 PM UTC

I remember hesitating on a ETH trade because of Coinbase's high fees and losing money because of it. Ever since I've felt like Coinbase is a scam wrapped up in pretty UI.

Re: Coinbase from YC to DPO

#413

Post by arcticbull » Wed, Apr 14, 2021, 8:13 PM UTC

Tenoke wrote: post #317

arcticbull wrote: post #306

Earlier quoted context omitted.

Sorry? They most certainly can be arbitrary numbers. [1] You know 99% of all LTC trading on Coinbase was one account trading back and forth with itself a couple years ago. Spoof trading involves putting up a big order, then yanking it at the last second before it gets executed. If you're the house, you can do literally anything if only the fox is watching the henhouse. As the peer response states, if you're the house…

.. Again that's all good in theory but in practice you can verify by trading. My orders do get filled faster on Binance, I can take advantage of the better spread and liquidity etc. The majority of orders aren't just disappearing randomly or anything. It's especially obvious when trading higher amounts or trading a smaller liquidity token in the first place. Maybe I can't verify the actual numbers but I can very much…

No you cannot verify by trading lol, any more than you can verify the payout ratio of a slot machine at a rigged casino. They can synthesize opening and closing the orders, matching them internally, based off a feed from a legitimate exchange. Since they control everything they can easily ensure they don't accidentally get matched to an external order. This gives the illusion of liquidity.

Re: Coinbase from YC to DPO

#414

Post by paulpauper » Wed, Apr 14, 2021, 8:13 PM UTC

aphextron wrote: post #407

paulpauper wrote: post #346

Earlier quoted context omitted.

also airbnb is not dependent on the value of a speculative asset. There will always be demand for rentals.

>also airbnb is not dependent on the value of a speculative asset. What do you think US real estate is?

people need shelter, they do not need crypto . There is huge demand for housing in metro areas even in spite of Covid, and regulation and other restrictions make it hard to increase supply, and landlords generally want to lock-in long-term rents with good credit scores due to difficulty of evicting, meaning more demand for short-term rentals. .

Re: Coinbase from YC to DPO

#415

Post by ashconnor » Wed, Apr 14, 2021, 8:14 PM UTC

seriousquestion wrote: post #386

bherms wrote: post #367

Earlier quoted context omitted.

This isn't accurate. All employees, regardless of tenure, got 7 years to exercise their shares that had vested up until that point.

That's surprisingly generous. Startups in Silicon Valley usually have a 30-90 day exercise window.

I guess if the point was to get rid of people then reducing the financial disincentive is a prudent move.

Re: Coinbase from YC to DPO

#416

Post by sibeliuss » Wed, Apr 14, 2021, 8:15 PM UTC

jude- wrote: post #392

sibeliuss wrote: post #349

Earlier quoted context omitted.

> If the means of coin production require owning coins, you have these problems that PoW does not have Producing blocks != coin production

If you're producing blocks, you're getting paid (otherwise what's the point). If the probability you get picked to produce a block is proportional to how many coins you own, then you're getting paid proportional to how many coins you own. I don't care for Algorand's shell game of trying to say that all tokens have been minted already, and are just being distributed. If it's the case that nodes who stake more coins ar…

> If it's the case that nodes who stake more coins are getting paid more coins, then all of my analysis holds

Thats fine, but it's an important clarification. All the tokens _have_ been minted already, and _are_ just being distributed. The mechanics are different. Owning 1 coin is one potential vote in a lottery to determine the validity of a proposed block. This is not the generation of new coins.

In any case, regarding nodes and payment, that process is being phased out by their new governance model which was just released the other day: https://algorand.foundation/the-algo/algo-governance.

Re: Coinbase from YC to DPO

#417

Post by arcticbull » Wed, Apr 14, 2021, 8:15 PM UTC

literallycancer wrote: post #163

arcticbull wrote: post #6

Earlier quoted context omitted.

Well, Binance is, somehow, dramatically more of a fly-by-night bucket shop intentionally looking the other way to people opening multiple accounts to avoid KYC -- and they won't event tell you in which country they're domiciled. They're one of Team Tether's top partners in crime. How on earth can you believe their volume numbers haha.

That's a feature. Willingness to avoid onerous regulation or even break the law to benefit users is a good thing.

Yeah, it's not lol, it screws over legitimate participants to benefit the house.

Re: Coinbase from YC to DPO

#418

Post by paulpauper » Wed, Apr 14, 2021, 8:15 PM UTC

kvz wrote: post #405

paulpauper wrote: post #346

Earlier quoted context omitted.

also airbnb is not dependent on the value of a speculative asset. There will always be demand for rentals.

Aren’t they firing a lot of folks due to the pandemic?

That was a year ago. Airbnb completely recovered and then some in terms of value. A few metro area like SF and NY were hit , but the overall picture is improving, and such setbacks will imho be temporary.

Re: Coinbase from YC to DPO

#419

Post by gonehome » Wed, Apr 14, 2021, 8:15 PM UTC

ilyaeck wrote: post #301

bglusman wrote: post #278

It's a tiny bit pedantic, but the Coinbase offering today was not actually an IPO, I learned, but a DPO (Direct Public Offering). It was not a fundraising event for Coinbase, only a liquidity event for shareholders, and unlike an IPO no explicit valuation process occurred to select an offering price.

What difference does it make? Shares trading openly on the market is as explicit a valuation process as it gets.

Banks rip off companies in IPOs by underpricing the stock so their investors get a kickback.

That's the least charitable way to write it, but it's somewhat close to the truth (the other part of the truth is that pricing is hard which is why we have markets).

DPOs allow companies to list at a reference price without losing out on money - they can sell at the true price later.

Banks naturally make up a bunch of reasons why this is bad, but it's mostly nonsense.

When one side does many of these types of transactions per year (banks) and one side may only do one or two in a lifetime (founders) expect the side with more experience to both tilt the deal in their favor and to have a compelling narrative of why it's actually better for you.

See: https://podcasts.apple.com/us/podcast/bill-gurley-direct-lis...

There's a funny story (I searched briefly, but couldn't find) that when Elon took Tesla public via an IPO and the bankers told him the initial price he just said "no, at least $XX or no deal". I think the bank price was $17 and he said at least $19, but I could be off on the numbers. They did his price and that price was still too low.

It's a mistake for any company to IPO from now on imo, SPACs are even worse really (unless you're running a fraud in which case SPACs are great).

Re: Coinbase from YC to DPO

#420

Post by brudgers » Wed, Apr 14, 2021, 8:17 PM UTC

nick0garvey wrote: post #409

aphextron wrote: post #407

Earlier quoted context omitted.

>also airbnb is not dependent on the value of a speculative asset. What do you think US real estate is?

I can live in a house. I can't live in a Bitcoin.

You can live in a car.

You can’t drive a house.