It’s no surprise that the first crypto platform to go public on the National Association of Securities Dealers Automated Quotation (NASDAQ) is surging in value. Coinbase, the largest American-crypto exchange, posted a net gain of $273 million after a bad stint of two years in the hole.
The financial market jumped on this news, and Coinbase’s stock rallied with more room for growth.
The positive push, however, has its downside.
You see, Coinbase hadn’t posted a profitable business quarter since Q4 of 2021. We can call that a long time, but in business terms, it’s considered an eternity.
Investors Pushed by Positive News
The news that inspired investors was a $904-million stream of net revenue to balance Coinbase’s books. Even better was that the American crypto exchange beat market projections by $80 million, leaving the company with a 45% higher performance outcome than its previous quarter of Q3.
Eyes On Retail Traders—NOT Institutional Investors
Orderflow is essential for any exchange, and crypto exchanges are no different. Though we’re also seeing large orders pushing crypto like Bitcoin and Ether upward, Coinbase’s recent rally comes from investments made at the retail level. Consumers made up a total of $493 mil by trading on Coinbase.
Coinbase
- Regulated exchange
- An easy-to-use platform
- Free crypto training offered
Coinbase
However, there was still a reasonable increase in institutional trading, which doubled from the previous quarter. The $43 million generated from institutional investments, however, is overshadowed by the activity of every-day traders. Large brokers, like Oanda or Forex.com, rely on institutions. Since fees and commissions are set per transaction, institutions end up paying more.
They not only trade with larger order amounts, but they execute more orders in each single day.
This is not the case with Coinbase, yet it surpasses market expectations with higher quarterly gains.
A Bigger Push From J.P. Morgan
Before pushing 12.7 percent upward, the Coinbase stock had already seen intriguing performance after J.P. Morgan gave the company positive ratings. At least, we can say “positive” compared to its prior rating. Now holding a “neutral” rating from its previous “underweight” rating, COIN still has a long way to go.
The J.P. Morgan investment bank, however, is taking the recent rally in Bitcoin into account. With BTC’s price raging over $48,000, Coinbase has and will see more activity within its exchange.
If you also see an opportunity unfolding, then now might be the best time to learn more about Coinbase. You’ll find reliable insights and easy tabs to get started with in our Coinbase guide.
