Why do IPO announcements always get upvoted so much?
Coinbase from YC to DPO
541–550 of 883 posts
Re: Coinbase from YC to DPO
#542Earlier quoted context omitted.
Wow. Assuming he put in just $10,000 (and I imagine it was probably more than that), 6000x return would be 60 million dollars. Any early companies out there right now seem like it could potentially offer even a 10th of that in ~5-10 years?
i dunno how people say VCs have a return of only 9% year when Ycombinator is absolutely crushing that even with a high failure rate. AirBNB, box, dropbox, coinbase, etc. Paul stumbled on an absolute goldmine by just giving a bunch of promising companies with good founders 10k in exchange for a decent portion of equity and then some of these companies being worth billions. NOw you know what those homes and are so expe…
What is the return like for Ycombinator?
Re: Coinbase from YC to DPO
#543Earlier quoted context omitted.
Yeah it sucks that the valuation for a company that inefficiently mines a resource that's going to be stored forever and mostly used to speculate, with only a small part of it ever put to productive use has such a high valuation. But yeah the valuation for Coinbase is also insane!
Oil is "mined" very efficiently, and I bet most of the production each year is used pretty quickly.
Oil is mined super inefficiently except for shallow wells, it has tight margins. Some operations, specially fracking, actually shut down pretty often when the barrel price goes down near 60 which is were we are now.
If you look at production vs. consumption in the world there's usually a bit more consumption than production. If you look per country on the US there's more production than consumption. That's because "extraction" is heavily played with to speculate with the price.
Re: Coinbase from YC to DPO
#544Earlier quoted context omitted.
Yes, but you also can't take your house with you stored in your brain if you have to flee the country. Bitcoin as chaos insurance (or schmuck insurance as Chamath calls it) is the use case that makes the most sense to me.
do you really think if the sh*t hit the fan? the entire BTC network and the internet at large would still be working for you to transfer these units around? this to me is where the comparison to gold falls off. i can hold physical gold and silver and trade it at will even without power, pricing updates, etc. this does not apply to crypto. considering cutting internet access is now a normal thing during unrest, being…
The people who say that bitcoin is going to be useful when "shit hits the fan" have a very very specific definition of shit hitting the fan that is just so unrealistic.
Re: Coinbase from YC to DPO
#545And down bitcoin goes. $3k off the highs. If given a choice between 1 million to invest in in a large cap growth stock portfolio vs. Bitcoin, I would choose the stock portfolio every time. Crypto too volatile relative to upside. Airbnb and other big tech growth stocks have much smoother returns which can be magnified with some leverage strategies.
Why? Lol. If your risk/reward profile is such, it's a fine investment. Super liquid, volatile, upward trend.
Yeah if you're 70 years old, don't throw in half of your net worth.
Re: Coinbase from YC to DPO
#546Earlier quoted context omitted.
As Powell announced cryptocurrencies ‘vehicles for speculation’. It is mind blowing the cryptocurrencies are making bets and are valued without any sound reasoning behind them. How many companies actually use them at regular place? How hard is the barrier of entry?
USD doesn't have sound reasoning behind them either (anymore). It's based on faith in the system.
It is backed by the U.S. Army.
Re: Coinbase from YC to DPO
#547Earlier quoted context omitted.
> the supposed point of crypto is to reducing the reliance on, and grifting from, companies like Coinbase That was the pitch of crypto. In practice, people are buying it as a bet that it will go up. I suspect most people are only buying it because the value is going up. If bitcoin actually worked like a currency and traded between $8k and $12 for the past 5 years, no one would care.
Global wealth is $400T. All crypto currency combined is worth about ~$2T at this point. So to store 0.5% of the world's wealth, we are using 0.6% of the world's energy. Banks obviously don't use anywhere near this much energy. Bitcoin is estimated to use more energy than all other server farms put together. So we are using 0.6% of the world's energy to store 0.5% of the world's wealth. And Doesn't seem like the ideal…
The energy spent on bitcoin’s proof of work is not tied to the volume of transactions though. At a technical/protocol level, the same amount of mining would be needed if there was $100 trillion being stored or $1 being stored.
Although higher prices make larger mining operations more enticing and profitable.
Re: Coinbase from YC to DPO
#548Compare Coinbase to say a major exchange like the NYSE. Realize that crypto is a space that could be damaged by gov intervention at any time. Realize that there is very little lock in effect on these markets, and fees are becoming less and less over time. How does Coinbase ever manage to justify a valuation this high? 100B.... Ping me when the stock price is under $100.
This IPO significantly weakened the "gov will ban it" argument, it's like too big to fail now that it's in the hands of millions of retail and institutional investors alike.
Re: Coinbase from YC to DPO
#549Earlier quoted context omitted.
Literally compare COIN to any other market maker or financial institution. I would love to hear some justification here.
https://www.advratings.com/banking/worlds-top-banks-by-marke... : it's in the top 10-20. Does anyone know what the value of assets under management by Coinbase is?
USD 90 billion "assets on platform" (which, as has been pointed out, is not a good metric for an exchange at all). That's about 5-12% of total crypto assets (depending on the time of day) [1].
By the way, Coinbase revenue in the last quarter was nearly 0.1% of the entire crypto market cap.
So, Coinbase took around 60$ of any 10,000$ traded on Coinbase, and 10$ of any 10,000$ crypto market cap, which implies that 1/6 of the entire crypto market cap traded through Coinbase once this quarter, unless I'm mistaken.
See the second story in Matt Levine's Money Stuff: https://www.bloomberg.com/opinion/articles/2021-04-14/good-a...
[1] more likely, the percentage is fairly constant, while the USD value fluctuates a lot with crypto prices, so "AUM" might be around USD 200 billion now (as crypto market cap is USD 2 tr).
Re: Coinbase from YC to DPO
#550So this pretty much legitimizes Bitcoin right? I can't imagine the US government deciding to crack down on it after such a high-profile IPO.
The whole mission of Coinbase is legitimizing cryptocurrency when you break it down. They are like Windows 95 to the internet, it is how many people will use the market.
People also asking why a company would go to the public stock market when they are an alternative market, well part of it is to legitimize it and reduce the chance for regulation. Once enough people are making money from it then it becomes harder to put back in the bottle. It is also part marketing, many people will for the first time hear about cryptocurrency soon because of it even though it has been around a decade+. It also makes the investors rich and fuels more cryptocurrency investments. This event alone will create many wealthy crypto entrepreneurs.
Coinbase is like cryptocurrency being merged into Wall Street main/master on git. This is the moment that truly merges the Wall Street investment world with cryptocurrency, for better or worse. The roller coaster has reached the precipice, no turning back now.