Coinbase’s rating lower due to departure of investors
2023.01.24 08:21
Coinbase’s rating lower due to departure of investors
By Kristina Sobol
Budrigannews.com – On Coinbase Global Inc. (NASDAQ:), Mizuho reiterated its Underperform rating and $30.00 price target. after a private survey revealed that, despite the rally in January, retail investors continue to avoid cryptocurrency. The survey, disappointing market share data, and possible signs of take rate pressure in Q4 may all indicate that revenue in 2023 faces additional challenges.
“Retail trading is COIN’s bread and butter, as it accounted for 83% of total revenue in 2021,” Mizuho analysts wrote in a note. Retail take rates are 130bps, whereas institutional take rates are only 1-2bps. According to our survey of COIN retail traders, “many bulls are hoping for more muted retail participation in the recent crypto rally.”
More than 170 COIN retail customers were surveyed by Mizuho. In particular, investors were questioned about how they traded in December and January. In January, the majority of the surveyed retail cryptocurrency traders remained inactive. Only 11% of retail traders who did not trade cryptocurrency in December said they did so in January. This indicates that nearly ninety percent remained idle.
Nearly one third of COIN users who reported trading crypto in December did not return to the platform in January.
On Tuesday, COIN shares are down 2.34 percent in pre-market trading.
