Coinbase Global Inc. (NASDAQ: COIN)’s stock prices have gone up significantly amid a surge in Bitcoin prices and even surpassed the listing price set during Coinbase’s direct public offering in 2021. The rise in share prices represents a major turn for the better for a crypto exchange that has dealt with significant challenges since it joined the stock market.
Coinbase share prices have surged by a whopping 60% since the beginning of the year and passed $252 per share this month, Coingape reports. This is the first time in several years that Coinbase shares have cleared the $250 mark and is part of a trend that has seen the company’s shares rise steadily in recent months.
Coinbase’s stock has appreciated by more than 300% during the past 12 months alone, compared to the lows of up to $33 seen during the cryptocurrency winter in 2023. The 2023 crypto winter saw cryptocurrency prices trend lower and lower through the year amid a sharp reduction in trading volume.
However, the crypto market has been in recovery mode since and even managed to regain some of its former glory when Bitcoin prices reached an all-time high of $70,000 as of March 8. Bitcoin’s performance was mostly due to a confluence of factors, such as speculation about the impending Bitcoin halving as well as a surge in investing flow into Bitcoin ETFs (exchange-traded funds), which had a positive effect on the overall cryptocurrency market.
On the other hand, Coinbase’s success was attributed to the crypto exchanges’ strategic partnerships coupled with a heavy presence in the young but swiftly growing Bitcoin ETF space. Coinbase’s exchange division, Coinbase Custody, has also partnered with several asset managers that launched Bitcoin-related Exchange Traded funds in early 2024. These partnerships are predicted to provide Coinbase with an estimated $25to $30 million in revenue from different fees.
Additionally, the crypto exchange’s operational performance is growth oriented and resilient, allowing it to generate $995 million in net revenue in the last quarter of 2023. This represented a 45.2% increase in net income from Q3 2023 ($825 million) and is an indication of the exchange’s improving performance.
An increasing number of market analysts have taken notice of Coinbase’s improving performance in their analysis of the crypto market. JPMorgan analyst Ken Worthington has changed Coinbase’s stock rating from underweight to neutral at $80, partly due to the influence of Bitcoin ETFs on the cryptocurrency system.
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