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Crypto exchange giant Coinbase announced at the end of last (December) that it had submitted an IPO application. However, a foreign media "The Block" reported recently that Coinbase will not follow the traditional IPO route, but will adopt "direct listing (DPO)." Way, but the stock on the exchange, and this statement was confirmed today.
Exchange leader Coinbase announced today (29) that it will adopt a direct listing (DLP or DPO) for public listing. If the U.S. Securities and Exchange Commission (SEC) finally approves it, Coinbase will be the first publicly listed cryptocurrency exchange Therefore, it is of great significance to the encryption industry.
According to a Coinbase blog article, Coinbase Global Inc intends to directly list "common A shares" so that the shares can be publicly traded, and will apply in accordance with the SEC's S-1 form.
IPO vs. DPO
Generally speaking, most companies have two ways to go public: IPO and DPO.
An IPO is an initial public offering (Initial Public Offering), in which a company issues shares for investors to subscribe through the stock exchange market, and this is also a method familiar to readers. The IPO process is through underwriting (Underwriting) and book building (Book Building), and then submitting a reference price to the stock exchange to apply for listing. Usually, the role of the underwriter is played by the investment bank.
Different from IPO, a direct listing of DPO is another way of a public listing. The difference is that the underwriting and ring buying process is omitted, and the reference price is directly provided to the stock exchange. It can be regarded as a simplified version of IPO, and dealers are selected. The process is simpler and more transparent. Among them, investment banks turned into financial advisors to help companies clarify their financial situation and handle the procedures for a public listing, including preparation of documents.
It should be noted that investment banks will still help find potential investors, but their role is not distribution, but a matchmaking role similar to an intermediary.
Source: Bityard (https://support.bityard.com/hc/en-us/articles/900005319263-Coinbase-announced-its-direct-listing-following-the-example-of-Slack-and-Spotify-wanting-to-gain-popularity-in-US-stocks-without-IPO-)