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Coinbase Upgraded to Neutral From Underperform at Bank of America on Positive Crypto Market Dynamics

Coinbase Upgraded to Neutral From Underperform at Bank of America on Positive Crypto Market Dynamics

Coinbase Upgraded to Neutral From Underperform at Bank of America on Positive Crypto Market Dynamics

The current macro backdrop has been positive for crypto market cap growth and trading volumes, the report said.

The current macro backdrop has been positive for crypto market cap growth and trading volumes, the report said.

The current macro backdrop has been positive for crypto market cap growth and trading volumes, the report said.

AccessTimeIconMay 17, 2024, 1:06 PM
Updated May 17, 2024, 1:08 PM
Bank of America (Taylor Simpson/Unsplash)
  • Bank of America raised Coinbase to neutral from underperform and boosted its price target to $217 from $110.
  • The current macro backdrop has been positive for crypto market cap growth and trading volumes, the report said.
  • The bank said risks include the exchange’s continued dependence on transaction revenue and the company’s ongoing lawsuit with the SEC.

Coinbase (COIN) shares rose 2.5% in pre-market trading on Friday after Wall Street giant Bank of America (BAC) upgraded the shares to neutral from underperform.

The investment bank raised its Coinbase price target to $217 from $110. The stock was trading around $204 at publication time.

Bank of America said it was upgrading the stock for a number of reasons, including the positive macro backdrop that has helped the cryptocurrency markets and trading volumes, analysts led by Mark McLaughlin wrote. The note also said the exchange's expense discipline and increased diversification should also help its earnings.

However, the analysts noted that there are potential risks that could limit the the stock’s upside, including the exchange’s continued dependence on transaction revenue for profitability and the regulatory overhang linked to the ongoing lawsuit with the U.S. Securities and Exchange Commission (SEC).

The shares fell over 9% yesterday following a report that the Chicago Mercantile Exchange (CME) might soon offer spot bitcoin trading, which could become a potential competitor to exchanges such as Coinbase.

Edited by Kevin Reynolds.

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Will Canny is a finance reporter at CoinDesk.n


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