Crypto

Coinbase sinks after FTX

Cryptocurrency platform Coinbase fell more than 5% in Wall Street premarket trading on Monday after falling more than 7% last Friday.

Bank of America downgraded the exchange from Buy to Hold due to the FTX crash and risks that could affect Coinbase.

The investment bank also cut its price target from $77 earlier to $50. So far, Coinbase shares have fallen almost 30%.

While BofA is confident that Coinbase is not another victim of FTX, this does not “make the company immune to a wider crypto market downturn,” the bank notes.

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“The analyst team sees 3 potential hurdles: a decrease in trading activity due to weakening confidence in cryptocurrencies, a delay in clarifying the regulatory framework, and the possibility of contagion, which will lead to an even wider decline in the industry,” the analysts explained, according to Coindesk.

The downgrade of Bank of America was a real blow to Coinbase, given that the bank has been bullish in the past. In January 2022, he gave the stock a Buy rating and a price target of $340.

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