Coinbase to Make S&P 500 Debut; Shares Jump 10% in After-Market Trading

Coinbase (Nasdaq: COIN) is set to join the S&P 500 index on 19 May 2025. The index tracks the largest 500 publicly listed companies in the US across various sectors, including finance, tech, healthcare, and more. Coinbase will be listed under the financials sector.

The cryptocurrency exchange will replace Discover Financial Services, which is being acquired by Capital One. Once the acquisition closes, Discover is expected to be delisted from the public markets.

An Instant Double-Digit Rally

Following the announcement yesterday (Monday) after market close, Coinbase shares jumped by about 10 per cent. The rally added to the 4 per cent rise in COIN shares earlier in the day due to improving market sentiment as the trade war concerns eased.

Although Coinbase shares are still down by around 27 per cent over the past six months, they have gained more than 17 per cent in the last month (excluding the latest after-market rise).

Benefits of Being an S&P 500 Company

As of 31 March, the S&P 500 represented a total market capitalisation of approximately $49.8 trillion. This benchmark index is market-cap-weighted, meaning companies with larger valuations—such as Microsoft, Apple, and Nvidia—have a greater impact on the index’s performance. In contrast, smaller constituents, particularly those ranked in the bottom 400 by size, carry significantly less weight. These firms, where Coinbase is likely to be positioned, typically account for just 0.01% to 0.2% of the index each.

Despite their limited individual influence, they collectively support the index’s overall diversification.

Being added to the S&P 500 brings several benefits for any company. The most immediate is an increase in demand for its shares. This happens because all index-tracking funds—such as ETFs and mutual funds—must buy the stock, usually leading to a rise in trading volume and sometimes in the share price.

Inclusion can also attract more institutional investors. Many funds are restricted to investing only in S&P 500 stocks, so joining the index can draw in longer-term capital and broader investor interest.

Meanwhile, Coinbase recently agreed to acquire the crypto options platform Deribit in a $2.9 billion deal. The transaction includes $700 million in cash and 11 million shares of Coinbase Class A common stock.