Coinbase’s Valuation Expected To Reach $8 Billion USD After Hedge Fund Investment

Investing, News | October 3, 2018 By:

Crypto exchange Coinbase is reportedly in talks with UK hedge fund Tiger Global Management regarding a possible $500 million investment, which would make the exchange one of the most highly valued US startups.

Citing anonymous sources, technology website Recode reported that Coinbase, which is currently valued at $1.6 billion following a $100 million round in August 2017, is finalizing the deal that would boost its valuation close to $8 billion. The sources said that Coinbase would add $250 million to its treasury, while another $250 million could go to buying out existing investors.

Founded in 2011, Tiger Global Management is an employee owned hedge fund sponsor. It provides its services to private funds that are pooled investment vehicles. The firm manages hedge funds and private equity funds. The firm’s fundamentally oriented investments focus primarily on the global Internet, technology, telecom, media consumer and industrial sectors.

Coinbase provides one of the leading platforms to exchange major cryptocurrencies, such as ethereum, bitcoin, and Litecoin. It recently disclosed that it is still profitable in 2018 despite the dip in value in some of the exchanges’s crypto offerings. In May of this year, the company announced a suite of new products aimed at institutional investors. At the time, Adam White, Coinbase vice president and general manager, said that these products can “unlock $10 billion of institutional investor money sitting on the sideline.”

Galaxy Digital crypto investment firm CEO Michael Novogratz said that the news about the Tiger Global deal proved that cryptocurrencies like bitcoin were more than just “tulip mania.”

“Here’s the poster child of the crypto space worth $8 billion — that’s a real company, and Tiger’s not a flake of an investor. These are smart, savvy guys,” Novogratz said.