How to buy Coinbase stock in Canada

It’s official. Coinbase, the largest cryptocurrency exchange in the United States, has publicly filed with the SEC to list on the stock exchange. Once approval for the Coinbase IPO is granted, the listing will be a landmark moment for crypto enthusiasts and could pave the way for other cryptocurrency businesses to go public.

Coinbase stock is not yet available to purchase on any exchange. But it’s expected to go public soon on the NASDAQ. Here’s what we know — and how to buy in when it launches.

Note: all dollar amounts on this page are in US dollars unless otherwise stated.

What we know about the Coinbase IPO

Coinbase, a digital currency exchange, submitted a confidential draft registration statement with the US Securities and Exchange Commission indicating its intention to go public via a direct listing. The submission comes on the heels of a rally for bitcoin. Coinbase is a popular platform on which to buy and sale cryptocurrency. The digital currency soared by 300% earlier in February to hit a record US$58,000 for the first time in its history, with a market capitalisation above US$1 trillion.

As per the recent filing, Coinbase, has announced its intention to list on the Nasdaq after filing with the US Securities and Exchange Commission (SEC). It accrued a total revenue of US$1.1 billion in 2020, representing a 100% gain over its associated 2019 total of US$482 million. Previous estimations had Coinbase’s value somewhere close to the US$8 billion mark. However, with the crypto market soaring and a wave of new investors entering this yet nascent space, it’s estimated that the exchange may now go public for more than US$100 billion.

We will update this page as new details emerge.

Will I be able to buy Coinbase stock from Canada?

You can buy shares in the company once it lists on the stock exchange. We don’t yet have a date as to when this might be, but some reports suggest it could be as early as March 2021. Once Coinbase goes public, you’ll need a brokerage account with access to the US stock market in order to invest. So, you’ll need a brokerage that provides access to international stocks.

Some Canadian online trading platforms that provide access to stocks listed in the US are Scotia iTRADE, Questrade, Qtrade Investor, Wealthsimple and Interactive Brokers.

The process of buying stocks in a US company while living in Canada is the same as buying stocks in a Canadian company. You buy and sell using your online trading account or through an investment broker who handles US stocks.

How to invest in US stocks from Canada

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How to buy Coinbase stock

Once Coinbase goes public, you’ll need a brokerage account to invest. Consider opening a brokerage account today so you’re ready as soon as the stock hits the market.

1. Compare share trading platforms.If you’re a beginner, look for a platform with low commissions, expert ratings and investment tools to track your portfolio. Narrow down top brands with our comparison table.
2. Open and fund your brokerage account. Complete an application with your personal and financial details, like your ID and bank information. Fund your account with a bank transfer, credit card or debit card.
3. Search for Coinbase. Find the stock by name or ticker symbol. Research its history to confirm it’s a solid investment against your financial goals.
4. Purchase now or later. Buy immediately with a market order or use a limit order to delay your purchase until Coinbase reaches your desired price. To spread out your purchase, look into dollar-cost averaging, which smooths out buying at consistent intervals and amounts.
5. Decide on how many to buy. Weigh your budget against a diversified portfolio that can minimize risk through the market’s ups and downs. You may be able to buy a fractional share of Coinbase, depending on your broker.
6. Check in on your investment. Optimize your portfolio by tracking how your stock — and even the business — performs with an eye on the long term. You may be eligible for dividends and shareholder voting rights on directors and management that can affect your stock.

How do similar companies to Coinbase perform?

It’s impossible to predict how any stock will perform — and IPOs can be particularly volatile. But evaluating the performance of companies like Coinbase can be useful in determining how the market is performing and whether now is a good time to invest in this industry.

• Visa Inc. (NYSE: V)

  Founded in 1958, Visa Inc. is a global payments technology company headquartered in California, US. It facilitates digital payments between consumers, merchants, financial institutions, businesses, strategic partners and government entities. It operates VisaNet, a transaction processing network that enables authorization, clearing, and settlement of payment transactions. In addition, the company offers card products, platforms, and value-added services. Its brands include Visa, Visa Electron, Interlink, VPAY and PLUS brands.

  In 2008, Visa went public on the NYSE with an initial share price of $44. On December 31, 2020, its stock hit an all-time high of $218.73. Its closing price on January 14, 2021 was $201.86. The company has a market cap of $471.942 billion.

• JPMorgan Chase & Co. (NYSE: JPM)

  New York-based investment and financial services company, JPMorgan Chase & Co., was founded in 2000 when The Chase Manhattan Corporation bought J.P. Morgan & Co. for $32 billion. The company provides ATM, online, mobile and telephone banking services, operating in 4 main segments: Consumer & Community Banking (CCB), Corporate & Investment Bank (CIB), Commercial Banking (CB), and Asset & Wealth Management (AWM).

  Prior to its merger with Chase, JP Morgan went public on the NYSE in 1942. Its stock fluctuated between $30 and $60 between 1999 and 2009, reaching a high of $67 in March, 2000. Stock prices rose over the next decade, jumping significantly between the years 2017 and 2020 and reaching an all-time high of $141.17 on January 14, 2020. The company has a market cap of $411.324 billion.

• Rocket Companies, Inc. (NYSE: RKT)

  Founded in 1985, Rocket Companies is a Detroit-based holding company that owns personal finance and consumer service brands including Rocket Mortgage, Rocket Homes, Rocket Loans, Rocket Auto, Rock Central, Amrock, Core Digital Media, Rock Connections, Lendesk and Edison Financial. In August, 2020, Rocket Companies went public on the NYSE with an initial share price of $18 — below its previously announced share price of $20-$22. The company’s market cap is just under $40 billion. On September 02, 2020, its stock hit an all-time high of $31.31. On January 14, 4040, its closing price was $20.16.

Compare online brokerages that provide access to US and Canadian stocks

To buy Coinbase stocks, you’ll need to open a brokerage account. Compare your options using the table below to find the best fit for you at the Coinbase IPO. Take a look at our guide on opening a stock trading account to learn more.

Note: The dollar amounts in the tables below are in Canadian dollars.

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Name	Product	Available asset types	Stock Fee	Option Fee	Account Fee	ETF Transaction Cost	Feature	Table description
Questrade		Stocks, Bonds, Options, Mutual Funds, ETFs, GICs, International Equities, Precious Metals	$4.95-$9.95	$9.95 + $1 per contract	$0	Free	$0 account fee and free ETF transactions.	Opt for self-directed investing and save on fees or get a pre-built portfolio and take some of the guesswork out.	Go to site More Info	Compare	loading Fetching your data...
Interactive Brokers		Stocks, Bonds, Options, ETFs, Currencies, Futures	Min. $1.00, Max. 0.5% of trade value	$1.50 min. per order	$0 (if monthly commissions are greater than or equal to US$10.00)	Min. $1.00, Max. 0.5% of trade value	Extensive trading capabilities and global investment tracking.	Access market data 24 hours a day, six days a week and invest in global stocks, options, futures, currencies, bonds and funds from one single account.	Go to site More Info	Compare	loading Fetching your data...
Wealthsimple Trade		Stocks, ETFs	$0	N/A	$0	Free	Deposit and trade $100 and get a $25 bonus.	Pay no commissions when you trade Canadian stocks and ETFs with Wealthsimple Trade.	Go to site More Info	Compare	loading Fetching your data...
Qtrade Investor		Stocks, Bonds, Options, Mutual Funds, ETFs, GICs	$6.95 - $8.75	$6.95 - $8.75 + $1.25 per contract	$0 if conditions met, otherwise $25/quarter	$0 - $8.75	Trade 100 ETFs free of charge.	Qtrade Investor offers low trading commissions and an easy-to-use platform with access to powerful tools and a wide selection of investment options. Trade 100 ETFs free of charge and thousands more for $8.75 or lower.	Go to site More Info	Compare	loading Fetching your data...

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A more detailed look at the recent Coinbase IPO filing

In its filing, Coinbase made it clear that it had yet to receive the green light from regulators that will allow it to trade crypto assets that have been deemed as “securities” within the United States’ borders.

It’s pertinent to note that American regulators currently classify Bitcoin as a commodity, however, a number of other premier currencies are yet to be classified as either securities or commodities.

For example, a couple of months back, the SEC filed a lawsuit against Ripple, the firm operating the world’s fourth-largest digital asset by market cap “XRP”, claiming that the company was conducting an unregistered securities offering.

Coinbase is widely considered to be one of the premier cryptocurrency trading ecosystems in the world today, boasting more than 43 million users spread out across 100 different nations. Not only that, the company has many high-profile investors including the likes of Andreessen Horowitz, Union Square Ventures (USV) and Ribbit Capital.

Lastly, a closer look at the crypto giant’s filing shows us that between 2019 and 2020, it was able to rope in a net income of US$322.3 million, swinging from a loss of US$30.4 million just the year prior. Furthermore, the document gives no indication of when the company plans to list its share on Nasdaq or for how much its shares are currently trading for within private markets.

WATCH: Coinbase IPO explained — How to buy shares

Coinbase’s balance sheet

Coinbase is the largest cryptocurrency exchange in the US, with over 43 million verified users and $90 billion in platform assets. Its global network is over 115,000 partners strong and spans 100 countries. Private trading of its shares in March 2021 suggests a $90 billion valuation, up $13 billion from its February valuation.

With the release of Coinbase’s S-1 filing, we were able to take a closer look at the company’s financials.

In 2019, Coinbase reported $533.7 million in revenue and a net loss of $30.3 million. In 2020, its revenue rose to $1.27 billion and it reported a profit of $127.4 million.

Rising revenue and falling losses is a promising trend — so long as Coinbase can continue its profit-making trajectory. But no investment is free from risk and the inherent volatility of the crypto sector may prove a determining factor in Coinbase’s profitability.

Tax implications of buying US stocks in Canada

Agreements between Canada and the US require Canadians holding US stock investments to pay the US Internal Revenue Service (IRS) a 15% withholding tax on any dividends earned on their US stocks. Interest earned from bonds or other interest-yielding US investments are similarly taxed at a rate of 10%.

An exception is made for stock investments held in trust exclusively designed to provide retirement income. Such trusts include RRIFs, LIRAs, LIFs, LRIFs and Prescribed RRIFs. RRSPs are also exempt from US withholding tax if you own US investments in the form of US stocks, bonds or ETFs.

Investment accounts that do not qualify for this exemption include RESPs, TFSAs and RDSPs.

All income from investments, including foreign investments, must be declared as part of your income on your Canadian tax return. Unless your US earnings are exempt from withholding tax, this means you’ll be double taxed on those earnings — first by the IRS, then by the CRA.

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