JPMorgan Lowers Coinbase Target Price, Anticipates Performance to Be Dragged Down by Weakening Trading Volume and Cryptocurrency Prices

Odaily News: Ahead of Coinbase's upcoming Q4 earnings report, JPMorgan has lowered its target price for the company from $399 to $290, citing factors such as declining cryptocurrency market trading volumes, weakening asset prices, and slower growth in USDC. However, the bank maintained its "Overweight" rating on Coinbase.

Analysts expect Coinbase's adjusted EBITDA for the quarter to drop to approximately $734 million, a significant decline from the previous quarter, primarily due to reduced spot trading volume and weaker stablecoin-related revenue. JPMorgan forecasts the quarter's spot trading volume to be around $263 billion, with stablecoin-related revenue at about $312 million.

Although the acquired derivatives exchange Deribit contributes new revenue for Coinbase, overall market weakness continues to pressure performance. Besides JPMorgan, institutions like Barclays and Compass Point also hold a more cautious stance, believing that retail trading, blockchain rewards, and subscription & service revenues may fall below expectations, remaining highly dependent on the overall trend of the cryptocurrency market.