Coinbase Stocks Plummet 10% as Wells Fargo Says ‘Sell’ (Report)

The bear market has been tough for everyone, and according to Wells Fargo, holding Coinbase stock may not be wise.

The multinational financial services company issued a profitability warning indicating that current market conditions may harm the publicly traded crypto exchange.

• Despite having the early mover advantage, Coinbase is now facing stiff competition from its rivals who have been blowing up the space in recent times.
• According to a CNBC report, Wells Fargo hinted that the company would sell shares of COIN and set a price target of $57.
• Its analyst, Jeff Cantwell, rated Coinbase with an underweight rating, arguing that downward pressure on the exchange is inevitable and that retail pricing is to blame.
• Following the projection, shares of Coinbase ( COIN ) fell nearly 10% after US markets opened on Thursday. At the time of publication, it is trading at $60.93.
• Amid the industry-wide slump, the cryptocurrency exchange lost more than $1 billion in the second quarter. It generated revenue of $808 million, down from $2.2 billion a year earlier.
• The company has endured a dismal 2022, struggling with a slew of crypto market corrections that in turn drove down its share price. He was also forced to lay off hundreds of employees.
• Regulatory woes continue as the US Securities and Exchange Commission (SEC) stepped up scrutiny of cryptocurrencies listed on the platform after deeming them securities.
• Watchdogs previously charged two former Coinbase product managers with insider trading.
• More recently, Veritaseum Capital sued Coinbase for patent infringement of cryptographic transfer technology. The lawsuit claims the crypto exchange violated its rights by making, using, selling, offering to sell and importing products and services into the US.