Coinbase Is Preparing For A New Crypto Bullish Cycle Amidst A Decline In Its Share Price

Following the decline in cryptos’ prices since November 2021, Coinbase shares haven’t been performing well either.

There Is No Basis For Comparison – Coinbase CFO

Even though the firm is convinced that its current performance doesn’t mean it’s share price should decline by this amount, that hasn’t prevented them from seeking fresh buy opportunities in the crypto world and getting prepared for a new bullish cycle.

Between last month and now, Coinbase’s share price has dipped by nearly 35%, a figure 10% higher than the average decline of the crypto market at 25%. Sharing his opinion about this development in a recent article on a popular crypto blog, Alesia Haas (Coinbase CFO) opined that Coinbase’s focus should be on diversifying its portfolio and not on the ups and downs of the crypto market. According to him, making such moves will stabilize the company’s share price with time.

He further said, “we were surprised that many analysts correlate our stock prices with the crypto prices. In all honesty, both have no basis of correlation because this ‘analysis’ doesn’t consider other factors that determine our company growth and market share. For instance, none of this analysis considers the long-term effect of our current growth action (notably, diversifying our business investment) on our growth.” 

Haas also explained that “it has become imperative that we diversify our income stream. For example, we are beginning to witness a spike in the revenues from our subscription services. Through this service, we generated nearly half a billion dollars in revenue in the last financial year, with more than $200m generated in Q4 2021 alone.”

Diversification, The Key For Long-Term Growth 

The company is also looking forward to increasing its revenue through the Coinbase NFT platform as the demand for NFTs continues to grow in astronomical proportions. However, Haas explained that Coinbase wouldn’t lose focus of its primary revenue source (crypto exchange services and crypto investments). Hence, Coinbase purchased $350K worth of crypto since the beginning of this year as an addition to its crypto portfolio currently valued at $500M.

Coinbase chief executive, Brian Armstrong, recently reiterated that the company remains committed to increasing its crypto portfolio by investing 10% of its profit from other services in it. Coinbase continues to look for ways to profit from its recent findings, which showed that at least 25% of all households have a crypto investment portfolio. The 2021 trade volume surged 9X compared to that of the previous year.

Former Goldman Sachs Exec Joins Coinbase

Coinbase has announced that Wall Street legend and former Goldman Sachs exec, Roger Bartlett, is joining Coinbase to oversee the firm’s global operations. The top US crypto exchange could do with Barlett’s vast experience in making Coinbase a force of reckoning in the financial and crypto market.

Coinbase’s Q4 report showed that 92% of its net revenue comes from transaction charges on the exchange’s platform. The report also showed that the firm had tripled its workforce from the previous year.

Leave a Comment