Coinbase stock price remained in a bear market as traders largely ignored the key announcements made at the System Update event. COIN moved to $244, well below the year-to-date high of $447. It is hovering near its lowest level since November 25.
Key System Update Announcements
Coinbase, the largest crypto exchange in the United States, hosted the final event of the year, during which its leaders made notable announcements that are meant to be bullish for the company’s stock.
One of the most important ones was that the company would launch a prediction market inside its application and website. Instead of building the product from scratch, the company will partner with Kalshi, a company with an $11 billion valuation.
Coinbase’s prediction market is a way for the company to diversify its revenue streams, something it has been working on for many years. Indeed, the company is now generating substantial revenue from services such as subscriptions, custody, and stablecoins.
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Coinbase also announced that it will start offering tokenized stocks and ETFs, a move that other companies have begun. The goal is to ensure that its global customers can now buy American stocks and ETFs at a minimal cost. Today, some of these customers find it difficult to invest in US stocks and ETFs.
Coinbase also launched token presales, allowing traders to trade tokens before they launch. Additionally, it will launch DEX assets, allowing users to trade Solana tokens in a decentralized way.
Therefore, the stock dropped because most of the announcements were already known. As such, investors are simply selling the news after the event. Also, companies like Robinhood and Kraken launched some of these solutions months ago.
Coinbase also dropped amid the ongoing crypto market crash, which has brought the valuation of all tokens to $2.9 trillion. This decline means that the company will make less money as the volume declines.
Coinbase stock also declined amid rising competition from companies like Schwab, OKX, and SoFi, which are launching services in the United States.
Meanwhile, analysts are pessimistic about the company’s business. The average estimate is that its quarterly revenue will come in at $1.96 billion, down by almost 14% from the same period last year.
Coinbase Stock Price Technical Analysis
Technicals suggest that the COIN stock price has more downside to go. It has just formed the first death cross pattern since March this year, as the 50-day and 200-day moving averages have crossed each other.
It has also moved below the important support level at $292, its lowest level in August, and the 50% Fibonacci Retracement level. Also, the Awesome Oscillator has moved below the zero line.
Therefore, the stock will likely continue falling as bears target this month’s low at $230. A move below that level will signal more downside, potentially to the psychological $200 level.
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