Coinbase NFT growing? Coinbase shares on the brink

NFTs to the rescue? – Coinbase stock shares fell to a historically low level during the meeting on Friday, April 22. The fall occurred two days after the launch of the beta version of its new NFT marketplace. The company announced its intention to enter the NFT space in October last year. Thus, more than 1.5 million people registered on the waiting list. The beta launch started on April 20, 2022.

Stocks fall as NFT marketplace grows

Coinbase shares have fallen colossally since the start of the month. The launch of the beta version of its NFT marketplace last week did not change the trend. Friday, COIN hit bottom at $131.25 and then closed at $131.52.

Everybody can access the website of the NFT Marketplace at this stage. However, with the launch of the beta version, only a few selected customers can buy and sell NFTs there. The platform is based on Ethereum with payments in ETH. The company plans to integrate other blockchains in the future and add unique features that would allow users to engage more.

John Todaro, senior research analyst at Needham & Company, said the real question is know if the marketplace will succeed in imposing itself or not. Although everyone had been waiting for it for months.

“Investors are now asking ‘can you really scale it, can it do volume, can it really compete with OpenSea?’ (…) Will it really increase revenue or will it just kick in and maybe crash. »

John Todaro, Principal Research Analyst at Needham & Company

Coinbase faces competition from OpenSea and LooksRare which dominate the market. Major crypto exchanges FTX.US and Binance, which also launched NFT marketplaces last year, are also strong contenders.

John Todaro said the performance of Coinbase shares over the past few months has also reflected broader market trends. He pointed out that interest rates have had an impact on tech stocks in general and crypto volumes have declined.

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Expert advice: Coinbase will have to wait for scaling

Needham & Company released a note stating that once Ethereum scales, Coinbase’s NFT marketplace could very gradually increase revenue.

“We remain bullish on the stock (Coinbase), we think it’s fundamentally very attractive (…) If they can scale it, I think it will really add to the stock. »

John Todaro, Principal Research Analyst at Needham & Company

In a report published in February, JMP Group also indicated that Coinbase could benefit from the NFT market in the long term.

“The company is investing in a number of areas that may not have as much immediate impact, but should contribute significantly to longer-term revenue, including its upcoming NFT platform”

Excerpt from the JMP Group report

Coinbase is betting on the future with its Coinbase NFT marketplace, despite the fall in its shares.

Jeff Dorman, co-founder and chief investment officer of crypto-asset management firm Arca, meanwhile said he was still Too soon for Coinbase’s NFT marketplace to prove its worth to investors.

“Given that NFTs as a whole are still not widely appreciated or accepted by mainstream finance, we believe it will take many quarters to see real traction before equity analysts give credit to Coinbase.”

Jeff Dorman, Co-Founder and Chief Investment Officer of Arca Corporation

According to him, the retail decline has added further pressure to Coinbase.

“Until Coinbase’s subscription and service businesses represent a larger portion of their revenue, Coinbase will continue to suffer in low volume/low retail environments”

Jeff Dorman, Co-Founder and Chief Investment Officer of Arca Corporation

L’Coinbase exchange IPO had caused ink to flow last year. However, it is clear that the competition is tough in the area. Yes the Coinbase action panicked the counters at its launchthere is still something to be done to maintain it.

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Coinbase NFT growing? Coinbase shares on the brink

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