The first Coinbase of the cryptocurrency exchange$Coinbase Global, Inc. (COIN.US) $Will log on to NASDAQ in a direct listing on Wednesday. Prior to this, the company disclosed that this year's Q1 user volume, transaction volume, revenue and other data are amazing.It is reported that the price of Coinbase on the Nasdaq private market has reached 373 US dollars, and the valuation will reach an astonishing more than 100 billion US dollars.

For the first day of Coinbase performance, the market is eagerly awaited. that,What exactly is a direct listing (Direct Public Offering,DPO)Where's Riley? When can we witness the exciting moment of the opening of Coinbase?

The first shares listed directly on Nasdaq

The listing of Coinbase will beNASDAQ's first directly listed company.Before that, many famous technology companies, such as$Spotify Technology SA (SPOT.US) $、$Slack Technologies (WORK.US) $、$Asana, Inc. (ASAN.US) $、$Palantir Technologies (PLTR.US) $And$Roblox Corporation (RBLX.US) $All of them are listed directly, but such transactions take place on the New York Stock Exchange.

Direct listing means that you can trade freely by simply registering the stock.It means that companies generally do not issue new shares to raise money (a restriction that SEC has approved for relaxation), meaning that old shareholders will resell some of their shares to make the deal. According to the prospectus, the resale registered shares determined this time are 115 million Class A common shares.

Direct listing can not employ underwriters, there is no inquiry, pricing and distribution links, there is no sales limit period, the company can directly list and trade old shares. The biggest advantages are:

• Save money:There is no need to hire underwriters to place new shares, and roadshows and other links can be avoided. As a result, by skipping these steps, companies can usually save tens or even hundreds of millions of dollars (the cost of a traditional IPO is often close to 7% of the total money raised).

• Reduce lock period restrictions:In the traditional IPO process, there is usually a 180-day lock-up period for original shareholders and internal employees, while DPO does not have this restriction.

• Market pricing mechanism:What has been criticized in traditional IPO is that investment banks hold down pricing to give large institutional investors access to a large number of shares, which easily profit from soaring share prices on their first day of trading. This is extremely disadvantageous to the overall growth of listed companies, because it makes the company should have raised less money. On the other hand, DPO avoids the unreasonable pricing in the traditional IPO process to the maximum extent and is priced by the market.

It can be predicted that with the gradual improvement of the DPO mechanism, companies, especially star technology companies, will continue to choose DPO for listing in the future.

Opening time of new US stocks

Prior to this, the star new shares that attracted attention also included the online game creation platform.$Roblox Corporation (RBLX.US) $It also adopts the method of direct listing.Roblox does not start trading until after 13:30 EDT, that is, in the afternoon.

Many Niu Youyou who are waiting for the opening of new US stocks will find thatUnlike Hong Kong stocks, new shares in US stocks cannot be traded directly after they open at 9:30 EDT and usually have to wait for an hour or more, and trading can begin at any time of the day.

This is mainlyOriginated from an ancient "price discovery" (Price Discovery) mechanism on the New York Stock Exchange.That is, on the day of the listing of new shares, the designated market maker (DMM) gathers large buyers and sellers together before public trading to conduct a public auction of the shares, a process that takes a certain amount of time.。I believe many cattle friends have seen this scene in Wall Street movies.

The purpose of price discovery is to use the supply and demand mechanism to stabilize the price at a more reasonable price, so that the stock price can be maintained at a relatively stable level after the start of public trading.

On the morning of IPO trading on Nasdaq, traders can submit buy and sell orders online. Nasdaq matches these orders and determines the opening price in real time on its electronic market, a process that can usually be completed in a very short period of time.IPO can negotiate a special opening time with the NASDAQ Stock Exchange.

Although the opening mechanisms of the two exchanges are different, the aim is to pursue relatively stable prices after the start of trading.To be sure, the opening times of new shares on both exchanges are uncertain, especially hot ones, which are also common in the afternoon in the US East.

For "the first share of cryptocurrency" and "the first Nasdaq DPO company", the editor, like Niu friends, is waiting for the opening moment of Coinbase. The market is generally expected to open at 12:00 local time, when do you think Coinbase will open? What is the opening price?