Crypto exchange Coinbase (COIN) is now facing a number of new headwinds due to the collapse of rival FTXBank of America said on Friday, as it lowered its rating on the stock to neutral for long.
The bank also cut its price target to $50 from $77. The shares rose slightly pre-market to $49.23, but are down almost 30% since the start of the month.
While BofA is confident that Coinbase is not another FTX, that does “not insulate the company from the broader fallout from the crypto market.
“The analyst team sees three potential headwinds: slower business activity thanks to lower confidence in crypto, delayed regulatory clarity, and the possibility that contagion will lead to even greater fallout for the industry,” they wrote. writes Bank of America analysts.
In the longer term, the bank said, the FTX debacle could lead to market share gains for Coinbase as the exchange can signal its regulatory compliance and the safety of customer assets.
Bank of America was previously a bull on Coinbase. In January, he gave the stock – which was then trading above $230 – a buy rating and a price target of $340.