Analysts have mixed opinions on Coinbase's acquisition of Deribit: Derivatives expansion is optimistic, but retail growth is questionable

Odaily News Coinbase chose to reveal the news of its acquisition of Deribit to the market before releasing its financial report at the close of U.S. stocks on Thursday. Benchmark analyst Mark Palmer pointed out that as more institutions adopt cryptocurrencies, the acquisition of Deribit will allow Coinbase to "immediately dominate the fast-growing derivatives field."
Oppenheimer analyst Owen Lau believes that this move will make Coinbase a "strong challenger" to Binance, Bybit and OKX in the field of derivatives, and emphasizes that "cryptocurrency options have weak cyclicality and there is stable demand regardless of whether the market goes up or down."
However, Compass Point analysts Ed Engel and Joe Flynn pointed out that Deribit mainly serves institutional clients and does not help increase Coinbase's retail-oriented perpetual contract trading volume. The two analysts downgraded Coinbase's rating to sell last week and reiterated that the US retail trading market has become saturated. Michael Klena of Architect Partners believes that this acquisition will not fundamentally change his assessment of Coinbase (target price of $170). After all, it is just an extension of the existing business and cannot reduce the impact of cryptocurrency market volatility on quarterly performance.