Can retail investors buy SpaceX? Republic launches tokenized private equity, investing in unlisted star companies at low cost

avatar
ABMedia
This article is machine translated
Show original
The U.S. investment platform Republic announced the launch of tokenized private equity, with the first target being Musk's space technology company SpaceX, and plans to expand to tech darlings like OpenAI and Anthropic. By issuing digital tokens representing shares through blockchain, Republic is opening the door for investment opportunities previously limited to institutions and high-net-worth individuals to the general retail investors. Republic, a New York-based investment startup, recently announced the issuance of SpaceX's indirect equity in the form of "Mirror Tokens". Although these tokens are unrelated to the original company and do not represent legal shareholding, holders can enjoy potential economic benefits tied to the company's performance. Unlike traditional private placements with thresholds often tens of thousands of dollars, Republic allows users to invest with low-cost amounts of $50 to $5,000 through Apple Pay or stablecoins, making it more accessible to the general public. These tokenized assets will reflect market expectations of SpaceX's price and provide a basis for the company's potential future performance in IPOs, acquisitions, or other events. Republic stated: "The goal of this plan is to break down the barriers that previously prevented retail investors from participating in star companies' private placements, allowing more people to share in the growth dividends of unlisted enterprises." Republic's co-CEO Andrew Durgee revealed that they will issue tokenized equity for more companies in the future, including OpenAI, Anthropic, Perplexity, Stripe, X (formerly Twitter), and Waymo. Despite attracting market attention, this innovation faces numerous regulatory and legal challenges, including questions about legality, compliance with securities laws, and information disclosure obligations. Benefiting from the Trump administration's open attitude towards the crypto industry and financial giants' active involvement, Republic's move seems less surprising. The SEC has been withdrawing lawsuits against exchanges and brokerage platforms, emphasizing that memecoins are not securities, and establishing specialized groups to advance crypto asset regulation. Traditional financial institutions are also entering this market: Coinbase is seeking to tokenize listed stocks, Kraken plans to provide year-round U.S. stock token trading, and BlackRock's CEO Larry Fink has stated that "tokenization of all financial assets is an important step for capital markets in the future." Republic's tokenized equity product heralds a revolution in democratizing capital markets. Through blockchain's high efficiency and liquidity, investment opportunities once reserved for a few are now opening to a broader range of investors. However, this change will inevitably spark more regulatory discussions and market experiments.

Cryptocurrency investment carries high risk, with potentially significant price volatility, and you may lose all of your principal. Please carefully assess the risks.

Coinbase's stock price recently surged nearly 40%, reaching a four-year high. Bernstein cited multiple reasons for believing Coinbase is undervalued, raising the COIN target price from $310 to $510. After Circle, the US stablecoin giant, went public, its stock price continued to rise, briefly approaching $300. Some investors are considering switching to COIN or arbitraging by selling CRCL and buying COIN.

Bernstein Cites Multiple Reasons: Coinbase is Undervalued

Bernstein analysts raised Coinbase's (COIN) target price from $310 to $510 based on higher profit forecasts, new growth drivers, and a revised valuation framework.

Coinbase is the only native cryptocurrency company in the S&P 500 index and is considered one of the most undervalued stocks. Bernstein's report highlighted the exchange's diverse business lines, including:

  • Leading US cryptocurrency exchange
  • Custody services for most Bitcoin and Ethereum ETF issuers
  • Base blockchain (Ethereum's fastest-growing Layer 2)
  • Key hub for tokenization, including the proposed JPMD token with JPMorgan Chase
  • Expected to be a major beneficiary of US stablecoin and cryptocurrency market structure legislation
  • Coinbase's revenue from Circle's USDC stablecoin
  • Acquisition of Deribit derivatives exchange, indicating plans to expand services globally

Bernstein believes Coinbase's market share remains solid despite new competition. Coinbase's commission rates remain unchanged, while competitors like Robinhood have raised rates to comparable levels. Traditional brokers' competition is still months away from launch.

After Coinbase's Q1 2025 earnings report, Bernstein updated its valuation model to reflect stronger growth, particularly in derivatives, staking, and stablecoin-related revenue. The company currently predicts 2025 revenue of $9.5 billion, with non-trading business revenue around $4.2 billion. Analyst projections for 2026 and 2027 revenues were raised to $12.7 billion and $14.1 billion, respectively, reflecting growth in trading and non-trading segments.

Analysts predict Coinbase's earnings per share will rise to $17.92 in 2026 and $20.38 in 2027 as operational leverage improves profitability. Bernstein's $510 target price is based on a 25x price-to-earnings ratio at the end of 2027, in line with industry peers.

COIN Rises Nearly 40% in a Week, Missed Circle? Consider Buying Coinbase?

Circle, the US stablecoin giant, has seen its stock price continuously rise since its official listing on 6/5, briefly approaching $300.

Some perspectives suggest that as Coinbase is a long-term partner of Circle and likely holds CRCL through stock exchanges in the early stages, investors who missed Circle's rally could consider buying COIN or arbitrage by selling CRCL and buying COIN, which might be one reason for COIN's nearly 40% rise in the past week.

(Circle Continues to Rise, Ark Becomes the Largest Winner on the Table, Is It Possible to Buy Coinbase Instead of Missing CRCL?)

Risk Warning

Cryptocurrency investment carries high risk, with potentially significant price volatility, and you may lose all of your principal. Please carefully assess the risks.

Source
Disclaimer: The content above is only the author's opinion which does not represent any position of Followin, and is not intended as, and shall not be understood or construed as, investment advice from Followin.
Like
Add to Favorites
Comments
Relevant content