Chicago, IL – December 4, 2024 – Today, Zacks Investment Ideas highlights iShares Bitcoin Trust ETF IBIT, Fidelity Wise Origin Bitcoin ETF FBTC, ARK 21 Shares Bitcoin ETF ARKB, MicroStrategy MSTR and Coinbase Global COIN.
Zacks Stock Ranked #2 (Buy). Coinbase Global operates the largest crypto exchange by trading volume in the United States. Coinbase is capitalizing on global crypto adoption with its wide range of unique crypto offerings.
After COIN’s debut in the “crypto winter” of 2021, shares suffered from falling crypto prices and the demise of its biggest competitor FTX. However, the company’s shares and fundamentals are recovering quickly given widespread global cryptocurrency adoption, innovation, and a robust balance sheet. Below are some reasons why the momentum at Coinbase will continue.
A significant obstacle in the crypto industry is the seamless conversion of fiat currency into crypto. On Monday, Coinbase announced an initiative to simplify the process. The Coinbase website wrote: “Today we are excited to announce the launch of ApplePay for all fiat-to-crypto purchases through Coinbase Onramp, the easiest tool to integrate Onramps into your existing products.”
Earlier this year, Coinbase also announced a strategic partnership with payments giant Stripe to “expand global adoption.” The Stripe and Apple deals represent a milestone for Coinbase, which appears to be the de facto choice for legacy payments giants. These deals put COIN in position to benefit from further global crypto adoption.
Coinbase is arguably benefiting more from Donald Trump’s presidential victory than any other stock on Wall Street. President-elect Trump announced during his campaign that he plans to fire Stock Exchange CEO Gary Gensler on day one. Gensler is COIN’s number one enemy because he has failed to provide Coinbase with regulatory clarity on whether certain assets should be treated as securities or commodities.
Even though Trump has yet to set foot in the White House, investors are aggressively offering “alt coins” to gauge the future. For example, Ripple, a cryptocurrency that has been embroiled in legal disputes for years, is up more than 300% since the election.
The robust price action and high trading volume are key catalysts for Coinbase, which charges high commissions, ranging from 0.5% to 4.5% depending on the coin.
So far, the performance and inflows into Bitcoin ETFs are as follows iShares Bitcoin Trust ETF, Fidelity Wise Origin Bitcoin ETF And ARK 21 Stock Bitcoin ETF were unprecedented. The company is likely to benefit as Coinbase acts as a custody service provider for most crypto ETFs. Meanwhile, COIN could continue to benefit as public companies look to mirror themselves MicroStrategys extremely successful “Bitcoin Standard”.
After breaking out on Election Day, COIN stocks are spiraling into a picture-perfect bull flag pattern. Meanwhile, persistent, long-term call option buyers continue to enter the market, which is convincing from the current chart pattern.
Despite the crypto industry’s “Wild West” reputation, Coinbase has a sparkling balance sheet and a growing cash pile.
Coinbase is the true leader in the crypto industry. The stock is expected to benefit from global crypto adoption, strategic partnerships and a strong balance sheet.
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Past performance is no guarantee of future results. Every investment carries the potential for losses. This material is provided for informational purposes only and nothing contained herein constitutes investment, legal, accounting or tax advice or a recommendation to buy, sell or hold any security. No recommendation or advice is given as to whether an investment should be made for you is suitable for certain investors. It should not be assumed that the investments in any security, company, sector or market identified and described have been or will be profitable. All information is current at the time of publication and is subject to change without notice. The views or opinions expressed may not reflect those of the Company as a whole. Zacks Investment Research does not engage in any securities investment banking, market making, or asset management activities. These returns come from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that are rebalanced monthly without transaction costs. These are not the returns of actual stock portfolios. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance metrics displayed in this press release.
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