S&P 500 Adds Coinbase, Shares up 8%

Summary

• Coinbase is set to join the S&P 500 on May 19th, replacing Discover Financial Services, a move that spurred an 8% share price increase and marks a significant milestone for the crypto exchange as it further integrates with traditional finance, having met profitability criteria despite a recent quarterly profit decline.

• PumpSwap, a decentralized exchange linked to the Solana memecoin launchpad Pump.Fun, has introduced a creator revenue-sharing program, allocating 50% of its trading revenue (0.05% per transaction) to token creators, potentially distributing millions based on past volumes.

• PumpSwap’s new revenue-sharing model has faced significant criticism on social media, with users arguing it incentivizes negative behaviors like “rug pulls” and discourages community takeovers of abandoned projects by rewarding potentially negligent or malicious developers.

Cryptocurrency exchange Coinbase is scheduled to be added to the S&P 500 index prior to market opening on May 19th, a development that has spurred investor interest and caused an 8% jump in its share price.

Coinbase Set for S&P 500 Debut, Boosting Share Value

Coinbase will take the place of Discover Financial Services (DFS) in the index, a change prompted by the merger between Capital One and DFS.

This inclusion represents a significant milestone for Coinbase, which initially went public on the Nasdaq in 2021.

Since its debut, Coinbase has increasingly integrated with the traditional financial sector, a trend that aligns with growing institutional and conventional finance interest in the cryptocurrency domain.

At the time of its direct listing, Coinbase’s market capitalization stood at $52.78 billion, with its shares closing at $207.22 on Monday.

This current stock price is considerably lower than its 2021 peak, when it traded above $357.

S&P 500 Inclusion Criteria and Coinbase’s Financials

The S&P 500 primarily consists of large-cap technology companies, but it also incorporates stocks from various other segments of the technology industry.

Over the past year, notable additions to the index have included companies such as Dell, Palantir, Super Micro Computer, and CrowdStrike.

To qualify for S&P 500 inclusion, a company is required to demonstrate profitability in its most recent quarter and have cumulative profits over the preceding four quarters.

According to CNBC reports, Coinbase has already fulfilled all these criteria.

The company reported a profit of $65.6 million in the last quarter, a figure substantially lower than the $1.18 billion profit recorded a year prior.

Its revenue has still seen an approximate 24% year-over-year increase, reaching $2.03 billion.

PumpSwap Introduces Controversial Creator Revenue Sharing

In a separate development within the crypto space, PumpSwap, the decentralized exchange associated with the Solana-based memecoin launchpad Pump.Fun, has launched a program to share revenue with token creators.

This initiative, according to the project, will allocate 50% of PumpSwap’s trading revenue to the creators of tokens.

Also Read: Coinbase Schedules Worldcoin (WLD) Listing Specifies Optimism Network Support

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