Coinbase received a ‘neutral’ rating from Goldman Sachs as the US dominance swelled

Wall Street titan Goldman Sachs has upgraded its rating on the publicly traded crypto exchange. Coinbase From “Sell” to “Neutral” at the same time setting a new price target of $282 for the cryptocurrency exchange stock.

The update, announced on Thursday, emphasizes the significant change in Goldman Sachs' view on Coinbase as a result of the recent bullish momentum in the cryptocurrency market.

Earlier today, the blockchain analysis firm Kaiko Coinbase, which usually accounts for less than half of all trade volume in the United States, has increased its market share in the country by 60% since the Security and Exchange Commission (SEC) approved 11 new places for Bitcoin. ETFs will start trading in January this year.

COIN's stock rating update reflects a broad, sustained rise in the cryptocurrency's price, reaching unprecedented highs.

This rally in the crypto sector is reflected in the massive increase in daily trading volume on Coinbase, reaching levels not seen since 2021. The roughly $5 billion in trading volume Coinbase saw on Jan. 11 — the day Bitcoin ETFs began trading — was higher. than the amount it saw on any day in 2023, and FTX came close to rivaling the amount the exchange saw on the day the exchange filed for bankruptcy in November 2022, according to BitDegree data.

But with Bitcoin's recent price rallies — with BTC setting a new all-time high — Coinbase's volume was the highest it's ever been. Data from BitDegree and CoinGecko agree that Coinbase broke its old daily volume record and saw a volume of nearly $12 billion on March 6. .)

As part of the update, Goldman Sachs has now raised its Coinbase earnings forecast by 48% since the start of February. In mid-February, shares rose after the San Francisco-based crypto exchange reported a profit of $273.4 million, compared to a loss of $557 million in the same quarter a year ago. In Q3 2023, the exchange reported a loss of $2 million in profits.

Goldman Sachs' initial “sell” is based on a cautious view of the crypto market's long-term prospects. The investment bank has previously expressed concern over the limited day-to-day use cases of cryptocurrencies outside of trading, calling into question the continued growth of exchanges such as Coinbase. However, recent performance and adoption rates in the crypto market have prompted a re-evaluation.

The new price target of $282 marks a departure from Goldman Sachs' earlier estimate, suggesting short-term optimism for Coinbase amid the current crypto market rally.