Why one trader is ‘cautious’ on the Coinbase debut as bitcoin hits all-time high

Why one trader is ‘cautious’ on the Coinbase debut as bitcoin hits all-time high

Bitcoin is blasting higher ahead of Coinbase's public market debut.

The cryptocurrency rose nearly 5% to a fresh all-time high above $63,000 on Tuesday ahead of Coinbase's direct listing, which is scheduled for Wednesday and could be valued at as much as $100 billion.

Bitcoin is up a stunning 118% year to date, according to Coin Metrics.

When it comes to Coinbase, investors should tread carefully, TradingAnalysis.com founder Todd Gordon told CNBC's "Trading Nation" on Tuesday.

"I'm a little cautious on this IPO," he said.

Because the exchange's bid-ask spreads “” the difference between what buyers are willing to pay for a given asset and what sellers are willing to accept “” are so wide, going public could make its lofty valuation a bit of a stretch, he said.

"Those spreads will come in just like stocks," said Gordon, who owns bitcoin. "That's going to help initially, but I think with a valuation of [$]100 billion coming in, it's going to be hard to justify when consumers realize that they want to compress spreads [and] make it more competitive."

Bitcoin also has a few fundamental obstacles ahead of it, Gordon said.

"The adoption following that first wave of institutional onboarding has slowed. [It's] getting a lot of negative