A New Way to Value FTX, Kraken; Another Ex-Regulator Joins a Crypto VC Firm

Are crypto exchanges overvalued? Our colleague Martin Peers drew this conclusion about Coinbase, whose shares have fallen more than 30% over the past two months. While the stock may look cheap on the basis of its price-to-sales multiple, Martin wrote, the company may still be overvalued if you look at a different multiple: its market cap compared to the market value of all cryptocurrencies traded. That got us looking at other exchanges using the same measure. 

Coinbase’s market capitalization represents 2.4% of the market cap of all cryptocurrencies currently in circulation, according to The Information’s analysis. Comparatively, Nasdaq Inc.’s market cap is just 0.07% of the total market cap of all U.S. equities, and stock brokerage Charles Schwab has a market cap that is 0.38% of the value of all U.S. equities.