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Coinbase from YC to DPO

blog.ycombinator.com

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Re: Coinbase from YC to DPO

#591

Post by fnord77 »

llamataboot wrote: post #515

Compare 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.

ipos in recent years seem more like unload-on-the-bag-holder events than fundraising events.

maybe they were always like this, but recently the valuations seem bloated by various measures.

Re: Coinbase from YC to DPO

#592

Post by programmarchy »

Grustaf wrote: post #496
paulpauper wrote: post #414

Earlier quoted context omitted.

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. .

Airbnb doesn't provide "shelter", it's for travellers.

Agree, AirBnB is essentially serving a luxury travel market.

Re: Coinbase from YC to DPO

#593

Post by bhupy »

eloff wrote: post #488
anonporridge wrote: post #477

Earlier quoted context omitted.

1. Keep valuable growth companies private for as long as possible where only accredited investors (rich people) can invest in them. 2. Open up to the public market only once you've reached the max theoretical valuation. The company is still hugely overvalued on hype and future growth is unlikely. Ideally, you quickly make it into the S&P 500 so you can hand off the bag to passive index holders who have very predictab…

Yeah, capital > labor as Thomas Piketty pointed out quite nicely.

Just FYI, that's just a theory, and in the decade since his book was published, there have been several rebuttals and refutations pointing out that this theoretical mechanism doesn't match the empirical data.

https://www.imf.org/external/pubs/ft/wp/2016/wp16160.pdf

> Using a sample of 19 advanced economies spanning over 30 years, I find no empirical evidence that dynamics move in the way Piketty suggests. Results are robust to several alternative estimates of r-g.

https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3546668

> Recent influential work finds large increases in inequality in the U.S. based on measures of wealth concentration that notably exclude the value of social insurance programs. This paper revisits this conclusion by incorporating Social Security retirement benefits into measures of wealth inequality. We find that top wealth shares have not increased in the last three decades when Social Security is properly accounted for. This finding is robust to assumptions about how taxes and benefits may change in response to system financing concerns.

Auten & Splinter came out with the most widely accepted[1] rebuttal, which showed that Piketty's theoretical model was based on a reality that ignored major taxes and transfers, and once you account for those, the effect goes away completely.

http://davidsplinter.com/AutenSplinter-Tax_Data_and_Inequali...

> Top income share estimates based only on individual tax returns, such as Piketty and Saez (2003), are biased by tax-base changes, major social changes, and missing income sources. Addressing these issues requires numerous assumptions, especially for broadening income beyond that reported on tax returns. This paper shows the effects of adjusting for technical tax issues and the sensitivity to alternative assumptions for distributing missing income sources. Our results suggest that top income shares are lower than other tax-based estimates, and since the early 1960s, increasing government transfers and tax progressivity resulted in little change in after-tax top income shares.

[1] https://www.economist.com/briefing/2019/11/28/economists-are...

Re: Coinbase from YC to DPO

#594

Post by 0xcb0 »

llamataboot wrote: post #515

Compare 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.

It will never be under $100 again! Like BTC will never be under $50k again. Well I have no plan about the price of Coinbase, this is more about the value it brings to the crypto market. To the liberation of money, wealth and power to the "normal" people.

It's a revolution and we as IT sector have been sleeping on it (at least it feels like there is a lot of negative feedback concerning this technology). We are good people, but we refused to follow that hype since 2009 as any RDBM could do the same ... nearly ... on a local scale. Well, not really imho

Now it's there and it wont go away. Tesla, VISA, Master, Coinbase, ... (I'm just from the west and know these, look at Asia, they are the future. They are much further than us)

There will be billions if not trillions pumping into that market. And it will continue, as the industrial revolution in late 19th century. It's a paradigm shift and nothing less!

That is a transparent market. NYSE will no be able to compete with it. Even thought it 100x more old and established. It'll look like a little shop in no time compared to Coinbase, Binance, TFX ....

There have been pseudo "mafia" structures for so long in traditional finance. DeFi and Crypto will show/shows the world how much money can be made handling money. Basically banks have been earning more than all money in the world combined, and they did NOTHING!!! They just got richer, while generating no value for society. They even harmed the society and we accepted it as we had no option.

Now we can shift that over generating value to the normal person. This is not less "crazy", generating value from basically nothing, but it's the only way to show that the current system is flawed.

Any gov. trying forbid with crypto will fail. It's too late! There is no way of shutting anything like ETH down. It's technically impossible if there is enough incentive for the mines/staker!

We need a better world! If the cost for doing so is to burn down NYSE (not literally), we should do so today. And not wait another 50 years.

Re: Coinbase from YC to DPO

#595

Post by throwaway3699 »

kgog wrote: post #561
llamataboot wrote: post #515

Compare 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.

> How does Coinbase ever manage to justify a valuation this high? 100B.... How is Doordash "worth" ~$50B? We're all in a delusion when it comes to public markets . We're not ALL in a delusion, but market movers certainly seem to be.

If FAANG can be worth > $ 1T, then $50B starts to seem fairly reasonable. I really don't know what justifies either evaluation though.

Re: Coinbase from YC to DPO

#596

Post by knowaveragejoe »

rgifford wrote: post #385

The NYSEs parent company Intercontinental Exchange Inc (ICE) is worth 66.40B. Today's IPO puts Coinbase at 100B+. The NYSE has been in operation since 1817. Coinbase has been in operation since 2012. The value of all crypto is Trading fees in the crypto-world are getting more competitive as more established players support crypto. I don't see a defensible market position here, let alone established track record or st…

The value of all crypto is ~2.27Tn at the time of writing:

https://www.coingecko.com/en/global_charts

Roughly 1Tn of that from 01/01/2021.

Re: Coinbase from YC to DPO

#597

Post by stevewodil »

anonporridge wrote: post #477
eloff wrote: post #358

Earlier quoted context omitted.

Its not pedantic at all, it's the most interesting part of this IPO, because this is a new way to do IPOs.

1. Keep valuable growth companies private for as long as possible where only accredited investors (rich people) can invest in them. 2. Open up to the public market only once you've reached the max theoretical valuation. The company is still hugely overvalued on hype and future growth is unlikely. Ideally, you quickly make it into the S&P 500 so you can hand off the bag to passive index holders who have very predictab…

Let's start having companies mint fungible tokens so anyone can invest in them early on. It's like ICO's but hopefully it goes better this time

Re: Coinbase from YC to DPO

#598

Post by dannyw »

GordonS wrote: post #572
llamataboot wrote: post #515

Compare 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.

I'm not so sure. Western governments could had intervened and banned or heavily regulated crypto currencies at any time over the past several years. In particular, the Silk Road and Alpha Bay take-downs would have been the perfect opportunities - but they didn't take them. Now we have crypto currency companies floating as public companies, and others (e.g. Tesla) heavily invested, speculatively, in Bitcoin - maybe cr…

Bitcoin is perfect for mass surveillance and privacy invasion.

It's as if all transactions, of any size, can be perpetually tracked, with a courtroom-ready digital signature reducing evidence doubt about who made a transaction.

Re: Coinbase from YC to DPO

#599

Post by gge »

purple_ferret wrote: post #23

Coinbase is definitely a success story in how to appeal to the masses. There were always alternatives, but coinbase always came out on top despite the high fees and poor customer service. I think Coinbase as a publicly traded company will be very interesting to follow. Not only is it a massively cyclical industry, but the supposed point of crypto is to reducing the reliance on, and grifting from, companies like Coinb…

> the supposed point of crypto is to reducing the reliance on, and grifting from, companies like Coinbase

Yes, that is still the case? Decentralized exchanges like Uniswap are dominating (over $1B volumes daily) and growing very rapidly. Crypto is and always has been about decentralization.

Re: Coinbase from YC to DPO

#600

Post by lovedswain »

rednerrus wrote: post #587
josu wrote: post #569

Earlier quoted context omitted.

A few arguments to justify the valuation: - Government intervention tends to benefit incumbents. - Coinbase employs a lot of lawyers [1]. - Coinbase invests a lot in lobbying [2]. - While fees are lowering for international exchanges, those who serve US customers are still able to get away with very high fees. - People are less sensitive to fees when the assets they are buying are very volatile. - NYSE serves brokers…

Aren't very high fees antithetical to crypto, also centralization?

Antithetical? High fees are all but a feature :)
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