Just-In: Coinbase Downgraded Amid Heightened Scrutiny After FTX Crisis
Crypto exchange firm Coinbase on Thursday was downgraded by analysts at financial services firm Cowen. Crypto companies face increased scrutiny following the collapse of FTX and the overall decline in trading volumes in the crypto market. COIN price fell 6% in pre-market trading hours, with the current price trading near the $35 level.
Cowen Downgrades Coinbase (COIN) Stock
Cowen downgrades Coinbase stock (COIN) from “Outperform” to “Market Perform” rating despite investors hoping for a recovery in the crypto market.
Cowen’s analysts Stephen Glagola and George Kuhle believe the collapse of Sam Bankman-Fried‘s crypto exchange FTX has led to increased scrutiny from the regulators U.S. Securities and Exchange Commission (SEC) and Commodity Futures Trading Commission (CFTC).
“COIN’s monthly trading volumes have seen a fairly consistent drawdown each subsequent month since November 2021, and there remains low visibility into either a stabilization or rebound in retail trading volumes over 2023 given the macro backdrop and FTX contagion risks on crypto asset prices.”
The analysts also its COIN price target to $36 from $75. Coinbase shares fell nearly 84% in 2022, from $232 a year ago to $37.70 at Wednesday’s close. At the time of writing, the COIN price is trading at $35.12, down 6% in pre-market trading hours.
In December, Mizhuo also downgraded Coinbase to “underperform” and said the COIN stock could drop 30%. The fall in revenue due to the continuous downfall in crypto prices and the FTX crisis were the main reasons behind the downgrade.
Can Crypto Market Recover Amid Increased Scrutiny?
Crypto exchange Coinbase also has to pay a $50 million fine to the New York State Department of Financial Services for allowing consumers to register accounts without background checks. Also, the exchange will invest $50 million to strengthen its compliance program.
However, experts remain hopeful about the crypto market recovery in 2023. Ark Invest CEO Cathie Wood has been purchasing Coinbase shares as she believes a turn of events in 2023. Wood also reaffirmed Bitcoin price hitting $1 million by 2030.
Also Read: Key Highlights From FOMC Minutes, Bitcoin And Ethereum Bull Run Coming
- Cyber Hornet Seeks SEC Nod for S&P 500 and XRP ETF
- Cathie Wood’s Ark Invest Eyes Stake in Tether as USDT Issuer Targets $500B Valuation
- Kraken Secures $500M at $15B Valuation, Eyes IPO in 2026
- Bybit Lists Ripple’s RLUSD Following BlackRock and VanEck Integration
- SWIFT Plans Stablecoin and On-Chain Messaging Pilot on Linea, Challenging Ripple
- Solana Price Set for Q4 Surge as Canary Capital ETF Filing Meets Wyckoff Accumulation
- Avalanche Price Could Surge to $50 as Transactions Jump 200%
- CHMPZ Price Prediction:Will This Net-Zero Community Token be the Next Gem?
- Ethereum (ETH) Price Set for a rebound as Whales Accumulate $1.6B ETH and Outflows Hit $622M
- HYPE Price Prediction As Bitwise Files For Hyperliquid ETF – Is $55 In Sight?
- Shiba Inu Price Eyes Recovery From Demand Zone With Burn Rate Soaring Nearly 400%
Why Trust CoinGape
CoinGape has covered the cryptocurrency industry since 2017, aiming to provide informative insights Read more…to our readers. Our journal analysts bring years of experience in market analysis and blockchain technology to ensure factual accuracy and balanced reporting. By following our Editorial Policy, our writers verify every source, fact-check each story, rely on reputable sources, and attribute quotes and media correctly. We also follow a rigorous Review Methodology when evaluating exchanges and tools. From emerging blockchain projects and coin launches to industry events and technical developments, we cover all facets of the digital asset space with unwavering commitment to timely, relevant information.
