How did Coinbase avoid the latest cryptocurrency crash?
Coinbase managed to avoid a major sell-off this week, after famed bitcoin bull Cathie Wood's firm Ark Investment bought over 200,000 COIN shares on Monday and Tuesday.
- Coinbase Global Inc (All Sessions) (NASDAQ: COIN) shares are up by nearly 5% this week, as of Thursday (22 July 2021)
- The crypto exchange has been able to stay unharmed by the latest cryptocurrency crash, which took down bitcoin by over 7%
- Ark Investment, a famed bitcoin supporter, bough over 200,000 COIN shares at the start of the week
- Despite being down 30% since its IPO in April, analysts still foresee a 67% upside potential on Coinbase
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Coinbase stock price: what’s the latest?
Coinbase found itself relatively unscathed in the latest cryptocurrency rout, as shares remained flat this week.
At one point, the crypto exchange’s stocks were even up as much as 10% to a high of US$235.64 a share.
One possible reason for this could be that Ark Investment bought over 200,000 COIN shares on Monday and Tuesday this week, founder Cathie Wood, a prolific supporter of bitcoin, revealed.
Nevertheless, the counter has fallen by 30% since its initial public offering in April this year, with the cryptocurrency market experiencing massive sell-offs.
Across the board, COIN currently has a consensus rating of ‘buy’ from 11 analysts and a price target of US$379, based on the latest data published by MarketBeat.
The price target represents a 67.6% upside potential from the stock’s last traded price of US$226 on Thursday (23 July 2021).
Earlier this month, Oppenheimer analyst Owen Lau raised his firm’s price target on the cryptocurrency exchange to US$444 from US$434 previously, while keeping an ‘outperform’ call.
Lau’s bullish call was based on the opinion that COIN is likely to repeat Q1’s strong performance in its Q2 report, which is scheduled to be released on 12 August.
What happened to bitcoin this week?
Between Monday and Tuesday this week, BTC crashed by over 7%, mirroring a massive decline in global stock markets. The Dow Jones Industrial Average recorded its worst day since October 2020.
According to Annabelle Huang, partner at Amber Group, ‘concerns’ about the ‘quality and strength’ of the global economic recovery has led to risk assets across the board turning weaker.
‘Coupled with recent BTC weakness, this just sent crypto market down further,’ she was quoted as saying on CNBC.
Crypto’s fall also followed reports of the New Jersey Attorney General issuing a Cease and Desist Order against New Jersey-based crypto firm BlockFi, ordering it to stop offering interest-bearing accounts.
Bitcoin also continues to be weighed down by China’s ongoing crackdown on cryptocurrency trading, which led to over 90% of bitcoin mines in the country being shut down last month.
The world’s largest cryptocurrency was then able to claw back 10% of those losses on Wednesday. Many analysts, however, warned that this recovery could be short-lived.
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