Coinbase Set Sights on Institutional Investors with Coinbase Prime


Coinbase Global (COIN) has doubled down on its commitment to address the growing needs of institutional investors eyeing opportunities in the cryptocurrency space. Coinbase Institutional has unleashed Coinbase Prime, an integrated prime brokerage solution that will offer trading capabilities to Coinbase’s institutional investors.

The new platform will offer custody services and data analytics as well as advanced trading services.

“Coinbase Prime, separate from Coinbase Exchange, was built with the specific requirements and services clients need to participate in digital assets. Whether you’re a financial institution, institutional investor, or company looking to add crypto to your balance sheet, Coinbase Prime has the tools and services you need,” Coinbase stated in a company blog post.

Among Coinbase Prime’s features are cryptocurrency transfers between cold storage and trading balance, advanced algorithms designed to minimize market slippage, and access to more than ten venues for deep liquidity. (See Coinbase stock analysis on TipRanks)

Mizuho Securities analyst Dan Dolev has warned that the recent plunge in Bitcoin prices could trigger the crypto winter scenario. During the winter of 2018, Bitcoin volumes dried up significantly, taking a significant toll on Coinbase transacting users and retail revenues. The analyst has since lowered his estimate of Coinbase.

Dolev stated, “We now expect FY21 revenue of $5.3bn, below our prior estimate of $5.6bn. We also lower our FY22-23 revenue estimates, and we assign a 9x multiple on COIN 2023 revenue to arrive at our $225 price target.”

The analyst maintains a Hold rating on Coinbase with a share price target of $225, implying 7.18% downside potential to current levels.

Consensus among analysts on Wall Street is a Moderate Buy based on 10 Buy and 4 Hold ratings. The average analyst price target of $388.86 implies 60.41% upside potential to current levels.

COIN scores 5 out of 10 on TipRanks’ Smart Score rating system, implying it is likely to perform in line with market expectations.

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