NY investment bank says ‘crypto winter is over,’ positive outlook for Coinbase
Analysts from prominent New York-based investment bank HC Wainwright have declared an end to the “crypto winter.”
The bank has initiated its coverage of US cryptocurrency exchange Coinbase with a “buy” rating, saying the company will benefit from the growing cryptocurrency industry worldwide.
In an April 26 note sent out to investors, Wainwright analyst Mike Colonnese observed that overall crypto asset prices are up 45% year-to-date (YTD) supported by a 67% increase in the price of Bitcoin (BTC).
According to the analyst, markets “have likely now entered BTC’s next bull price cycle which has historically resulted in significant growth in total crypto market capitalization, incremental retail and institutional adoption, and higher crypto trading volume.”
“Crypto winter is over, and spring has sprung.”
Colonnese added that Coinbase is “uniquely positioned to take advantage of the large and rapidly growing global crypto economy” given that it stands as the largest publicly traded crypto exchange in the world. As a result, the investment company expects the company to expand its market. share in the cryptocurrency sector through the rest of 2023.
Colonnese set a price target of $75 per share for Coinbase ( COIN ) stock, which marks an increase of nearly 40% from the current trading price of $53.89.
He explained that the new price target is based on an expectation that Coinbase will continue to benefit from “the continuation of crypto’s bullish price action in 2023.” He noted that bullish sentiment usually precedes a Bitcoin (BTC) halving event, the next of which is scheduled for April 2024.
Further justifying the $75 price target, Colonnese wrote that the crypto exchange has established a “robust user base” with 110 million verified and 8.3 million active users in 100 countries.
Overall, there are a total of 884 institutions that currently have investments in Coinbase, according to data from Fintel. This figure marks a 2.1% decline in ownership from Q4 2022, with the average portfolio weight of total institutional investment in Coinbase declining 15.12% in the same time frame.
The largest institutional holder of Coinbase shares is Cathie Wood’s ARK Invest, which currently holds 11.7 million shares representing 5.09% ownership in the company. In its most recent NASDAQ filing, ARK Invest reported owning 9.2 million shares, representing a 22% quarterly increase.
Related: Coinbase files lawsuit to compel SEC’s response to rulemaking petition
Wainwright analysts are not alone in believing that the end of crypto winter has come. In an interview with Cointelegraph, veteran crypto trader Phillip Swift reiterated his view that the bear market has come to an end. However, the price of Bitcoin could return to “as low as $20,000” before the next bull cycle starts, he said.
Ultimately, however, Swift argues that the halving narrative will gather steam in the latter half of this year “which should increase buying pressure.”
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