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One of most anticipated IPOs of 2021 took place Wednesday with Coinbase Global hitting the public markets. The cryptocurrency exchange companyopenedfor trading at $381 a share. An analyst believes shares can go much higher than Wednesday’s opening price.

The Coinbase Analyst:BTIG analyst Mark Palmer initiated shares of Coinbase with a Buy rating and $500 price target.

The Analyst Takeaways: Palmer called Coinbase the gold standard among digital asset exchanges.

Coinbase is seeing rapid growth as the crypto ecosystem expands and its increased use is a tailwind for the company going forward.

“We believe COIN, the most popular consumer-facing cryptocurrency exchange in the U.S., is positioned to be a primary beneficiary of the increased adoption of Bitcoin and other digital assets as it continues to scale in the U.S. and internationally,” Palmer said.

Coinbase reported revenue of $1.8 billion for the first quarter, which was more than its entire fiscal 2020. One concern was the company’s cautious tone that the first-quarter results shouldn’t be viewed as a representation of its run rate.

“We believe they demonstrated the platform’s ability to generate explosive growth,” the analyst noted.

Another concern for Coinbase is its dependence on transaction fees (96% of 2020 revenue), which could make the company volatile to the crypto markets. The analyst said Coinbase is diversifying its revenue stream.

Coinbase reported an 11.3% market share for the amount of the world’s crypto assets held in the first quarter. “This market share is at the core of our bullish thesis on COIN, the company’s upside could be immense,” Palmer said

The $500 price target is based on a multiple of 16x estimated fiscal 2024 revenue of $8.2 billion. The analyst estimates Coinbase to report revenue of $6.1 billion in fiscal 2021 and $6.3 billion in fiscal 2022.

“We believe COIN should be regarded as a market leader in a category characterized by rapid and apparently sustainable growth driven by significant changes in consumers’ behaviors and their adoption of new technology,” the analyst said, adding that there are other comparable category leaders such as Zoom Video Communications Inc,Tesla Inc and Snowflake Inc.

COIN Price Action:Shares of Coinbase are down 1.68% to $322.75 on Thursday.