In the wake of FTX, Coinbase lost a third of its stock market value in a month
Posted Nov 23, 2022, 9:27 AMUpdated Nov. 23, 2022, 9:51 a.m.
This is called the domino effect. The Nasdaq-listed cryptocurrency exchange Coinbase has lost 35% on the stock market in almost a month, in the wake of the rout of its counterpart FTX. The stock, which was still worth $75 on October 25, is now only worth $43. In view of the downtrend, Bank of America downgraded Coinbase from “buy” to “neutral” on Monday, while lowering its price target to $50 from $70 previously. The American bank, which says it is convinced that “Coinbase is not another FTX”estimate that “this does not immunize it from the broader fallout in the cryptocurrency market”. The fall is all the more severe as Bank of America had been particularly optimistic between the introduction of the company, in April 2021, and January 2022. At the start of the year, it still set a target price of 340 dollars. .
Industry observers told us last week that they were convinced that Coinbase could make the most of the situation, since, being listed on the stock exchange, it is constrained to greater transparency requirements than its counterparts. An effect that remains to be demonstrated. At the end of October, the exchange » recorded a decline in turnover for the third quarter in a row. In a letter to her investors, she then judged that “transaction revenue was heavily impacted by macroeconomic and crypto market headwinds”. Sign of a situation that should not be resolved in the short term, the company laid off around sixty employees at the beginning of November according to The Information. She had already separated from 18% of her staff, or about 1,100 people, this summer.
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