Brian Armstrong, CEO of Coinbase Global Inc., will speak at the Messari Mainnet Summit in New York on Thursday, September 21, 2023.
Michael Nuggle | Bloomberg | Getty Images
Coinbase shares surged more than 20% on Tuesday, heading towards the sharpest rally from the day after President Donald Trump’s election victory after Crypto Exchange joined the S&P 500.
S&P Global said in a release late Monday that Coinbase is replacing Discover Financial Services. This change will take effect prior to trading on Monday.
Stocks added to the S&P 500 often increase in value as funds tracking benchmarks are added to the portfolio. For Coinbase, it’s the latest sharp move, even though it’s been months since Trump was elected to return to the White House.
Coinbase’s stocks seize 31% on November 6, the day after the election, and are optimistic that the next administration will adopt a more crypto-friendly policy after four years of challenging and lawsuits during President Joe Biden’s term.
The company and CEO Brian Armstrong were the leading financial supporters in the 2024 campaign, supporting pro-crypt candidates up and down tickets. Coinbase is one of the top donors of the company and has given over $75 million to Fairshake and its affiliates. Armstrong personally donated more than $1.3 million to the mix of candidates.
The launch of Trump’s terminology has largely been favored by the crypto industry through deregulation and executive orders to establish strategic Bitcoin reserves, but legislation has been stagnant so far. This is partly due to concerns surrounding Trump’s personal efforts to benefit from the code through Memecoin and other family initiatives.
Coinbase is also on a roller coaster, with 26% in February and 20% in March, with Trump’s tariff announcements held the market, pushing investors out of risk. The rallies on Tuesday led to a stock price increasing by around 2% per year.
Since publishing its 2021 direct list, Coinbase has become a larger part of the US financial system, increasing the value of Bitcoin, and has received regulatory approval for large institutions to create Spot Bitcoin Exchange-Traded funds.
Bitcoin went above $100,000 last week, approaching record prices in January. Cryptocurrency exceeded $104,000 on Tuesday.
To join the S&P 500, companies must report profits in the most recent quarter and earn cumulative profits over the last four quarters.
Coinbase last week reported net profits down 24 cents per share from $65.6 million, or $180 million, or $4.40 per share, after accounting for the fair value of its crypto investments. Revenues rose 24% to $2.03 billion, up 2.4% from $1.64 billion a year ago.
The company announced last week it plans to buy Dubai-based Delibit. It announced that this is a major $2.9 billion crypto derivatives exchange. The biggest deal in the crypto industry so far will help Coinbase expand its non-US footprint.
Watch: Bitcoin surges above $100,000
