Coinbase Will Replace Discover in the S&P 500

Coinbase (NASDAQ:COIN) is set to join the S&P 500 after the market opens on Saturday, replacing Discover (NYSE:DFS). The news sent Coinbase's stock up 8% in after-hours trading.

Coinbase will be the first major cryptocurrency company to be included in the S&P 500, a move that could attract more institutional investors to the crypto space. Coinbase has been steadily expanding its presence in Web3 and has now secured a place at the heart of traditional finance.

Coinbase met several criteria for inclusion in the S&P 500, including posting positive net income in the most recent quarter and cumulative profitability over the past four quarters. The company reported a net income of $65.6 million, or $0.24 per share, for the quarter, compared to $1.18 billion, or $4.40 per share, for the same period last year.

Coinbase also met the revenue requirement for inclusion in the S&P 500, reporting a 24% year-over-year increase in revenue to $2.03 billion from $1.64 billion.

As of Monday's market close, Coinbase stock was priced at $207.22, with a market capitalization of $53 billion. This valuation is significantly lower than the all-time high of $357 reached in 2021, but it is still sufficient for Coinbase to be included in the S&P 500.

Unsurprisingly, the news had an immediate impact on its stock: COIN rose 8% during the extended trading session. However, it’s worth noting that the entire S&P 500 was rallying that Monday, gaining 3.3%, along with major tech stocks like Amazon (NASDAQ:AMZN), Apple (NASDAQ:AAPL), Nvidia (NASDAQ:NVDA), Tesla (NASDAQ:TSLA), and others.

Coinbase is the latest company to be added to the S&P 500, which is a market-cap-weighted index that tracks 500 large-cap U.S. companies. The companies included in the S&P 500 are selected by Standard & Poor's, a subsidiary of Moody's Corporation (NYSE:MCO).

Coinbase's addition to the S&P 500 is a milestone for the cryptocurrency industry, which has faced increased scrutiny from regulators in recent years. The company's inclusion in the index could help to attract more institutional investors to the crypto space, which could lead to further price appreciation for cryptocurrencies.