11/25/2023 0 Comments Coinbase stock nasdaqAs a result, the company had to reduce its fees from 4% to 1.5%. Coinbase was forced to cut its fee on retail trades due to competition piling up. However, the crypto bear market isn't the only issue. All this resulted in Coinbase reporting a net loss of $430 million, or a loss per share of $1.98. In addition, the total trading volume reduced from $335 million in the first quarter of 2021 to $309 billion in the most recent quarter. Also, monthly transacting users (MTUs) tanked to 9.2 million in the first quarter of 2022, down from 11.4 million in the fourth quarter of 2021. The company missed analysts' revenue estimates as it earned around $1.17 billion versus the analysts' expectations of $1.48 billion. ![]() However, in the first quarter of 2022, Coinbase's revenue fell more than 35%. Both these figures outnumbered the top-line and bottom-line figures of the prior year. Instead, it just seems like right now is not a good time for crypto.īack in 2021, when the crypto market was booming, Coinbase reported an annual profit of more than $3.6 billion on $7.8 billion in revenue. The Fed's decision to hike interest rates to combat inflation has swayed investors away from cryptocurrencies, damping the outlook for Coinbase, but this doesn't mean Coinbase is doomed. The problem concerning COIN isn't internal. This means that any turmoil in the cryptocurrency market will have a dire knock-on effect on COIN. A Shaky Start to the Year: Competition is Heating UpĬoinbase generates most of its revenue from commissions on retail trades, entailing that the stock has a high correlation to the crypto market. Hence, we are neutral on COIN stock.Ĭoinbase's "Neutral" 5 out 10 Smart Score Rating also agrees with our sentiment. ![]() So, whether Coinbase will weather the current downturn and honor investors remains a burning concern, making COIN a touch-and-go stock for now. However, Coinbase might turn up its profitability, given its operating flexibility. ![]() If you think cryptocurrencies will be around 10 years from now, and that more people will be trading them than now, it's hard to imagine a world where Coinbase isn't a prominent brokerage in the space.Unfortunately, the consistent decline in the stock price doesn't present a positive outlook for investors. I do think the added competition could put pressure on trading fees and therefore pressure on the company, but Coinbase has survived crypto winters before and still has one of the most established brands in the industry. While it's still not a huge part of revenue, subscription and services revenue at Coinbase in Q1 grew roughly 170% year over year. Coinbase One, the company's subscription service, enables users to conduct commission-free crypto trading for as many as 10,000 transactions per month. The company pointed out on its recent earnings callthat more than half of its active users now use Coinbase for activities other than trading, including crypto farming, spending crypto with businesses, and using it on decentralized applications.įurthermore, Coinbase is seeking to diversify revenue with subscription services. ![]() While I wouldn't say this is a good development for Coinbase and could present some tough times ahead, I would not go as far as to say the company is doomed.įor one, Coinbase has long known it needs to diversify its revenue and has been working to do so. The one-stop financial services platform SoFi also announced that it will enable users to invest a portion of every direct deposit into cryptocurrencies with no fees attached. But Binance.US is not the only exchange bringing competition on fees.
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