Share:

Crypto exchange Coinbase (COIN) is now faced with a number of new headwinds because of the collapse of rival FTX, Bank of America said Friday, as it downgraded its rating on the stock to neutral from buy.

The bank also slashed its price target to $50 from $77. The shares were up marginally in premarket action to $49.23, but are down nearly 30% since the start of the month.

While BofA is confident that Coinbase is not another FTX, that doesn't “make the company immune from the broader fallout in the crypto market.

”The analyst team sees three potential headwinds: Dampened trading activity thanks to weaker confidence in crypto, delayed regulatory clarity and the possibility that contagion leads to an even wider fallout for the industry," analysts from Bank of America wrote.

Longer term, the bank said, the FTX debacle may lead to market-share gains for Coinbase, because the exchange can point to its regulatory compliance and security of customer assets.

Bank of America had previously been a bull on Coinbase. In January, it gave the stock – at that time trading above $230 – a buy rating and $340 price target.

All writers’ opinions are their own and do not constitute financial advice in any way whatsoever. Nothing published by CoinDesk constitutes an investment recommendation, nor should any data or Content published by CoinDesk be relied upon for any investment activities. CoinDesk strongly recommends that you perform your own independent research and/or speak with a qualified investment professional before making any financial decisions.

Join Telegram

Follow us on Telegram

Stay updated of all the news

Join Telegram

Recommended content


Follow us on Telegram

Stay updated of all the news

Join Telegram

Recommended Content

Editors’ Picks

Binance suspends USD transfers, CZ says the issue is being resolved

Binance suspends USD transfers, CZ says the issue is being resolved

Binance, the world’s largest exchange by trade volume, has announced that USD bank transfers will be temporarily suspended. Only a small portion of the exchange’s users will be impacted by the interruption of the service. 

More Binance Coin News

Shiba Inu bulls watch for reaction in SHIB price as total value locked in ShibaSwap doubles

Shiba Inu bulls watch for reaction in SHIB price as total value locked in ShibaSwap doubles

Shiba Inu ecosystem witnessed a slew of positive developments with the launch of layer-2 scaling solution Shibarium’s beta, rising total value locked in ShibaSwap and skyrocketing SHIB burn rate. 

More Shiba Inu News

Will Bitcoin price test $20,000 again?

Will Bitcoin price test $20,000 again?

Bitcoin price shows clear signs of distribution occurring on the four-hour chart, which indicates the possibility of a trend reversal. Moreover, BTC has been consolidating for more than two weeks with no direction in sight, making it a perfect place to form a local top.

More Bitcoin News

Ethereum Classic inching towards greatness?

Ethereum Classic inching towards greatness?

Ethereum Cassic price is consolidating before what appears to be the next move up. Risk management should be considered moving forward, as the ETC price will likely witness an influx of volatility.

More Ethereum Classic News

Bitcoin: Nonfarm Payrolls on the radar after Powell’s speech propels BTC higher

Bitcoin: Nonfarm Payrolls on the radar after Powell’s speech propels BTC higher

Bitcoin (BTC) price is at an inflection point as it continues to rally amid multiple sell signals on lower time frames. The Nonfarm Payrolls (NFP) report, including the unemployment rate and average hourly earnings, is set to be announced on February 3 at 1330 GMT.

Read full analysis

BTC

ETH

XRP