The crypto and traditional market has now seen figures posted by major crypto exchange Coinbase, detailing its second quarter performance. The publication has highlighted considerations about the need to evaluate investment portfolios that include COIN stock. While investors must analyze the stock’s market performance before making a decision, the state of the general crypto market is also a crucial factor to consider.
Recent Crypto Market Price Trajectory
Crypto investment is a broad endeavor with varying approaches and strategies. While some prefer to remain with established options, others invest in new assets and may look through Coinbase or Binance’s upcoming listings to find new tokens likely to explode shortly after they are officially listed. Nevertheless, the general state of the crypto market is sometimes potent enough to affect market sentiment towards the industry, including crypto-related stock prices.
In general, the price of cryptocurrencies has slumped. Within a week, Bitcoin (BTC) fell nearly 9% from $70,000 to $64,000. A further plunge saw the king coin crashing to $51,000. Ether (ETH), the second-largest asset, also fell and lost nearly 27% in one week, with Solana (SOL), BNB, and XRP losing 30%, 21%, and 18%, respectively. Recently, heavy plunges in crypto prices erased several hundred million dollars worth of crypto’s market capitalization. This has soured the market sentiment towards crypto and COIN stock.
The correlation between crypto prices and the traditional market is sometimes high. This correlation is more direct with a crypto stock like COIN and an asset like Bitcoin. In general, the transaction volumes on Coinbase and Binance tend to fall when crypto prices crash. This correlation is also present on decentralized exchange (DEX) platforms.
According to data from DeFI TVL (Total Value Locked) aggregator DeFi Llama, trading volume fell from $266 billion in March to $157 billion in June. July’s figure slightly increased, $4 billion higher than July’s June’s.
COIN’s Figures
According to MarketWatch data, COIN is trading at $196 after falling nearly 16% in 5 days, 10% in a month, and about 13% in three months. The stock’s year-to-date (YTD) performance is about 14% up and almost 130% higher in the last year. In addition, an AI prediction for COIN is considerably bullish for 2025. However, the more recent figures show that COIN’s performance has been underwhelming.
According to the release, Coinbase’s Q2 revenue hit $1.4 billion, a 12.5% crash from the $1.6 billion from Q1. Also, transaction revenue fell 27.5%, from $1.076 billion in Q1 to $780.9 million in Q2. Furthermore, the release stated that the entire crypto market capitalization crashed 11% Quarter on Quarter (QoQ) compared to Q1. Likely explaining the plunge, Coinbase wrote that crypto asset prices increased in Q1 as BTC ETF products launched, with QoQ market cap rising 20% in the same period.
Buy or Sell
In general, the exchange is optimistic despite the plunges. With Adjusted EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) at $596, Coinbase notes that Q2 is the company’s “6th consecutive quarter of positive Adjusted EBITDA.” In addition, Coinbase wrote that its balance sheet climbed by $733 million QoQ to $7.8 billion.
Other positive figures include subscription and services revenue up 17% QoQ to $599 million, stablecoin revenue up 23% QoQ to $240 million, and blockchain rewards fee up 23% QoQ to $185 million.
Despite the exchange highlighting positive figures and posting a strong outlook, the recent figures may indicate a further plunge. Some analysts believe that COIN falling below its 50-day Exponential Moving Average (EMA), plus a possible double-top pattern with $195 at the neckline, means the stock is mostly bearish.
On the other hand, a Nasdaq analysis awards COIN a Buy rating based on recommendations from 23 analysts. According to the analysts, the average 12-month price target is $260.85. However, both analyses may be correct if COIN spikes later but continues to plunge in the short term.
Nonetheless, COIN’s bullishness may be valid depending on the state of adoption in the crypto market. As crypto’s popularity increases and spreads into everything from politics to crypto gambling, Coinbase could benefit from a general spike in crypto integration.
