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Coinbase stock could tank 35% despite Bitcoin ETF approval – analyst says

By: Invezz
coinbase stock could tank despite bitcoin etf

2024 will likely be “a more challenging year” for Coinbase Global Inc (NASDAQ: COIN), says Kenneth Worthington – a JPMorgan analyst.

Coinbase stock has downside to $80

Worthington downgraded the crypto company this morning to “underweight” and said its shares could tank to $80 – which suggests more than a 35% downside from here.  

BTC is now back under $40,000 even though the Securities & Exchange Commission of the United States approved some eleven applications for Spot Bitcoin ETFs on January 10th (find out more).

$BTC Price Nears $40K: Factors and Future Outlook 📉🔍

• 📊 #Bitcoin price trends downward, currently close to $40K, marking a 16% drop from its January high.
• Two key factors influencing this decline:
1⃣ Underwhelming Bitcoin ETF Launch: The much-anticipated spot Bitcoin ETF…

— RichQuack (@RichQuack) January 22, 2024

The JPM analyst turned bearish on Coinbase stock today primarily because he “sees potential for ETF enthusiasm to further deflate, driving lower token prices and lower trading volume”.

It is conceivable that the Nasdaq-listed firm will suffer in terms of revenue as a result, he added.

Bitcoin ETF expectations are too high

Kenneth Worthington is not entirely convinced that a Bitcoin ETF will significantly boost capital inflow for the crypto space.

Watch here:

At the very least, the analyst expects exchange-traded funds to take longer-than-expected to deliver on that promise. His research note reads:

Initial net inflows into Bitcoin ETFs seems to be far less than crypto community was touting, and less than what we witnessed in first week of flows into Gold ETF when it launched in 2004.

All in all, the JPM expert is now dovish on Coinbase stock simply because expectations related to the Spot Bitcoin ETFs are a bit too unrealistic. The crypto company is anticipated to lose 12 cents a share in its current financial quarter versus $2.46 per share a year ago.

The post Coinbase stock could tank 35% despite Bitcoin ETF approval – analyst says appeared first on Invezz

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