Coinbase stock price was down by 10 percent in yesterday’s trading session. The drop comes amid reports showing poor performance for the company.
In its latest quarterly financial report, the company reported a 64 percent decline in revenue, which was partly contributed by the current bear market of the cryptocurrency industry. However, the report also went on to add that the platform had also revised downwards its transacting users.
In raw numbers, Coinbase indicated that it had lost $1 billion in the second quarter, missing most analysts’ estimates for revenue. The company also had a loss of $4.98 per share. However, many analysts had a consensus that the company would lose only about $2.65 per share. Therefore, the drop was a surprise for many and may have contributed to the sudden market price loss.
Coinbase’s revenue was reported to be $803 million. This was also an underperformance from what many experts expected. Coinbase indicated that it had gone down by 66 percent to $616.2 million in its retail transaction revenue numbers. The number was also below the projected value by analysts, further highlighting problems with Coinbase.
Yesterday’s drop of 10 percent was a snapshot of what will likely happen in the subsequent few trading sessions. Therefore, I expect the prices to continue dropping. With problems mounting for the company, there is a high likelihood that we will see the crypto trading below the $65 price level.
A drop below $60 is also possible in the long term. One of the reasons why I also think Coinbase will continue dropping is because most investors are still processing yesterday’s losses. Therefore, in the next few trading sessions, we might see other investors joining in the sell-off, which is likely to send Coinbase into a continued downward spiral.
However, should the price trade above this week’s price high of $103, then my bearish analysis will be invalidated. It will also indicate a possible move to the upside.
This post was last modified on %s = human-readable time difference 13:17