Coinbase is Joining the S&P 500 — a Milestone Moment for Crypto and the American Economy

The $52 billion company, which runs the largest publicly traded crypto exchange in the U.S., will replace Discover Financial ServicesDFS)COF)S&P Global said late Monday.

Coinbase(NASDAQ:COIN) is set to join the S&P 500 — a milestone moment not just for the company but arguably for the American economy itself.

The $52 billion company, which runs the largest publicly traded crypto exchange in the U.S., will replace Discover Financial Services(NYSE:DFS) in the index, S&P Global (NYSE:SPG) said late Monday.

The change will take effect on Monday, May 19, giving investors less than three weeks to buy up the necessary shares of Coinbase.

But the significance of Coinbase’s inclusion goes well beyond boilerplate index maintenance. Investors are already cheering the news both on and off social media, with shares up 10% premarket Tuesday morning compared to modest declines in the Nasdaq, Dow Jones Industrial Average, and yes, the S&P 500 itself.

For starters, Coinbase is likely to benefit from the “forced demand” that index inclusion creates, as both active and passive funds which track the S&P suck up shares in order to mirror their benchmark — a major reason investors are likely jumping aboard ahead of the company’s May 19 inclusion date.

The larger significance of the move is a cultural moment in which crypto — bonds’ and equities’ sometimes-creepy cousin — finally gets a seat at Wall Street’s main table.

What it takes to make the S&P 500 (it’s not easy)

The S&P 500 isn’t just an index. It’s the index, long considered the gold standard of American corporate legitimacy.

It’s meant to represent the 500 most valuable publicly traded companies in the U.S. and, as such, to reflect the breadth and depth of the larger economy. Companies must meet strict criteria: a market cap over $20.5 billion, consistent profitability over four quarters, high trading volume, and at least 50% of shares available for public trading.

However, even checking those boxes isn’t enough. There’s no application to join, even though companies often maneuver to position themselves for spots. A committee of economists and index analysts at S&P Dow Jones Indices(NYSE:SPGI) decides which companies enter or leave the S&P 500 based on broader economic trends and shifts in the market landscape.

What’s more, the identities of the committee members aren’t public, a safeguard intended to prevent lobbying and preserve independence. In this way, the committee’s decision to add Coinbase signals a deliberate institutional judgment.

Crypto infrastructure? It’s no longer fringe. It’s part of the system. It’s becoming part of the establishment now.

For Coinbase itself, the win is both symbolic and tied to tangible rewards. It’s a reward for surviving crypto’s brutal winters, navigating regulatory uncertainty, and shifting from a retail-focused app to an infrastructure firm serving institutions and developers. It’s also a potential cash-in opportunity for large shareholders and the chance for a sunny final chapter in what's been a rocky year one for Coinbase's public listing.

But skeptics haven't disappeared

As critics are quick to point out, Coinbase relies heavily on volatile crypto trading volumes and has only recently finished its tussle with the SEC. Some argue the S&P inclusion says more about criteria and process than permanence—implications that could spell trouble for Coinbase in the long run.

Still, the moment matters. Wall Street doesn't have to believe in crypto to accept that it's not going away. Ditto retail investors. That a group of MBAs, PhDs, and old Wall Street hands sees Coinbase as stable and large enough to represent the larger U.S. economy is a sea change.