Coinbase Stock Is Ready Reach $240 (and Beyond)

COIN stock - Coinbase Stock Is Ready Reach $240 (and Beyond)

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When the Nasdaq’s correction spread to cryptocurrency prices, Coinbase (NASDAQ:COIN) fell in sympathy. COIN stock traded between $158 and $162 in January through March before rallying to over $190. The longer Coinbase holds the 20-day and 50-day simple moving average, its chances of rising to the $240 level increases.

At above $240, the stock may face resistance at the 200-day simple moving average. High volatility in cryptocurrencies in the last few months drove transaction volumes. Coinbase’s secure online platform for facilitating such transactions will appeal to consumers. In addition, people who are new to this market will need a digital currency storage solution.

In 2021, Coinbase’s monthly transacting users (MTU) topped $11.4 million, up from 2.8 million the year before. Trading volume grew by more than 8.5 times year-over-year. Its market share of trading volume increased in nearly all assets.

To reduce risks, Coinbase diversified its revenues. For example, it generated over $500 million in subscription and services revenue in 2021. Staking, earn and custody are transactions in products that potentially increase Coinbase’s margins. The company also broadened its customer type. It increased its institutional customer base by over 50%. The launch of Coinbase Prime, an integrated solution for institutional crypto needs, is in its infancy. Coinbase will advertise the merits of managing crypto assets in one place.

Cryptocurrency volatility is the primary driver of Coinbase’s revenue. Bitcoin (BTC-USD) may fall sharply. Those plunges are a regular risk in Bitcoin’s long history. Those scary changes will only lead to higher Bitcoin transactions. To educate new and existing customers, Coinbase has a multitude of tutorials. Since it extends into non-fungible tokens (or NFTs), experienced cryptocurrency investors have new markets to consider.

Coinbase’s addressable market expands as market interest in NFTs grows. Coinbase will capture this new market through Coinbase NFT Marketplace. It will profit through this offering. This is akin to a gold rush, where wealth comes not from mining but from supplying pans and shovels.

Bottom Line on COIN Stock

COIN stock moves primarily in the direction of cryptocurrency prices. As interest in NFTs takes center stage, expect that pattern to change. Coinbase is an all-encompassing platform that will serve crypto investors. Its NFT marketplace will give customers another digital product to consider buying.

Still, Nasdaq’s correction that began at the start of the year is not yet over. Worries are still mounting as markets guess how high the Federal Reserve will raise interest rates. Higher rates will increase the value of fiat currency. It may potentially hurt crypto prices. Fortunately, excess volatility in crypto is a positive catalyst for COIN stock to reach $240.

On the date of publication, Chris Lau did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the Publishing Guidelines.

Chris Lau is a contributing author for and numerous other financial sites. Chris has over 20 years of investing experience in the stock market and runs the Do-It-Yourself Value Investing Marketplace on Seeking Alpha. He shares his stock picks so readers get actionable insight to achieve strong investment returns.

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