Coinbase Global Inc stands to benefit even from a tanking Bitcoin(CRYPTO: BTC), according to Goldman Sachs.
What Happened: The New York-headquartered investment bank said that the cryptocurrency trading platform is likely to beat second-quarter estimates labeling it a tactical trade, reportedCoinDesk.
In a memo, Goldman noted that volatility in Bitcoin led to soaring trading volumes, which in turn presents an opportunity for Coinbase to rake in revenue in the form of fees.
Even if the prices of BTC stay depressed, nervous users of the platform contribute to Coinbase’s coffers in the form of trading fees.
Coinbase shares traded 2.45% lower at $247.67 in Monday’s regular session. BTC has slipped 48.95% from the all-time high of $64,863.10 that it touched in April. At press time, BTC traded 3.85% lower at $33,115.20.
Nance reportedly said in a note that investors are put off by Coinbase’s post listing decline, as the company’s shares have fallen 25% from their peak, but said investors could begin “reengaging in the coming quarters.”
In late June, Coinbase CEO Brian Armstrong called for thebuilding of a “crypto app store”similar to the one hosted byApple Inc(NASDAQ:AAPL).
Armstrong’s call was based on the growth of non-fungible tokens or NFTs and Decentralized Applications or DApps. At the time, the CEO also advocated an “international-first mindset.”