Coinbase Stock Rises 8% After Joining S&P 500 as First Crypto Firm

Coinbase is set to become the first crypto-native company to join the S&P 500, following an announcement by S&P Dow Jones Indices on May 12. The update will take effect on Monday, May 19, replacing Discover Financial Services after its acquisition by Capital One.

Following the news, according to Google Finance data, Coinbase shares (COIN) surged 8.8% in after-hours trading.

The S&P 500 Inclusion

The Nasdaq-listed exchange, founded in 2012, secured its place in the index after meeting key profitability requirements. Notably, eligibility for S&P 500 inclusion depends on consistent profitability across recent quarters.

In support of this, Coinbase posted a net profit of $65.6 million in the first quarter of 2025. Although revenue declined 10% quarter-over-quarter due to reduced trading activity, the firm recorded a 24% year-on-year increase, reaching $2.03 billion. 

Following the announcement, CEO Brian Armstrong took to X to highlight the growing permanence of cryptocurrency in the financial system. The company also shared a message referencing a well-known progression in how new technologies are received. It suggested that crypto’s journey from skepticism to mainstream recognition had reached a new peak with its inclusion in the S&P 500.

Institutional Exposure Set to Rise

Joining the S&P 500 opens the door to increased institutional visibility. Index funds tracking the benchmark will now be required to hold Coinbase stock. As of March 31, the index covered a market cap of $49.8 trillion. Coinbase will likely hold a smaller position in the index, estimated between 0.01% and 0.2% by weight.

The S&P 500 inclusion coincides with other major developments at Coinbase. On May 12, the company announced a $2.9 billion acquisition of Deribit, a leading crypto options exchange. The move signals Coinbase’s expansion beyond spot markets.

With this move, Coinbase joins companies like Tesla and Block, both notable for their Bitcoin holdings, within the S&P 500. Meanwhile, Strategy (formerly MicroStrategy), despite its sizable crypto exposure, was excluded due to a $4.2 billion net loss in Q1 2025.

Moreover, the milestone underscores a broader shift in how traditional markets perceive crypto-native firms. Remarkably, Coinbase’s inclusion reflects the industry’s increasing relevance in global finance, even as volatility persists.

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