To The Moon

🌟🌟🌟Bitcoin is down by almost 5% in the past 24 hours and $Coinbase Global, Inc.(COIN)$  has dropped by 6% as Bitcoin retreats.

The US market is facing pressure from a strong US dollar and anticipation of upcoming PCE inflation data. 

Bitcoin, the world's largest Cryptocurrency by market capitalisation, fell to a low of 61,144.02, marking its lowest point in several weeks.  The price decline resulted in more than USD 130 million in losses for traders in a single day.  This sharp decrease caught many off guard, triggering a series of automatic liquidations on various trading platforms.

Bitcoin has reached a weekly high of USD 67,000 last Tuesday but has since experienced consistent Bearish pressure. 

Several factors have contributed to this market correction.  One of them is that over the  past 2 days, large scale transactions have dropped by 42%, falling from 17,091 to 9,923.  This reduction inactivity from major players in the market has likely contributed to the overall Bearish sentiment.

Another factor is the outflow of funds from Spot Bitcoin ETFs as last week saw substantial withdrawals from these ETFs.  The largest Spot Bitcoin ETF is $iShares Bitcoin Trust(IBIT)$ which is down 7.7% today and almost 10% this week.

It is not surprising that Coinbase's shares have dropped in tandem with Bitcoin as it is one of the world's largest Cryptocurrency exchanges.  Coinbase's share price is now down 11% for the past 5 days.  However it is still up 35% year todate.  In 2023, Coinbase has skyrocketed 242%!

In its Q124 earnings report, Coinbase's revenue rose 112% year over year to USD 1.64 billion and beat analysts' expectations by USD 300 million.  Its EPS or Earnings Per Share of USD 4.40 also cleared the analysts forecast by USD 3.33 and improved tremendously from its net loss of 34 cents the previous year quarter.

Coinbase expects its subscriptions and services revenue to grow 3% to 17% sequentially avd 57% to 79% year over year.

For the full year, analysts expect its revenue to rise 77% to USD 5.5 billion.  Its adjusted EBITDA is expected to jump 181% to USD 2.7 billion and its adjusted EBITDA margin to rise to 49%.

However with the recent volatility in cryptocurrencies, this maybe impacted. 

The good news is that SEC has approved 8 Spot Ethereum ETF applications on May 23.  This will pave the way for the ETFs to begin trading later this year. 

Meanwhile the surge in interest for Spot Bitcoins and the attention that Spot Ethereum ETFs applications are generating have also resulted in new developments elsewhere.  In April 2024, the Hong Kong Securities and Futures Commission granted conditional approval to several fund managers for both Bitcoin ETFs and Ethereum ETFs.  Canada has already approved Ethereum ETFs since 2021.

When Spot Bitcoin ETFs were approved in January, there was a surge in inflows and as a result, Bitcoin price reached USD 70,000.

Coinbase is currently the main custodian of 8 out of 11 Spot Bitcoin ETFs and may also play a prominent role in the custodianship of Ethereum ETFs.  This validates Coinbase as one of the safest, easiest and most trusted custodian for cryptocurrencies. 

Wall Street Analysts are bullish on Coinbase with a Buy rating, Target price of USD 261.66, an upside potential of 23%.

Cryptocurrencies are here to stay but they are rather volatile assets.  Coinbase is a great stock to buy  and hold long term as it has exponential growth ahead. 

As Warren Buffett likes to say When there is Fear in the markets it is time to be greedy. 

@Daily_Discussion  @TigerStars  @MillionaireTiger  @Tiger_comments  @CaptainTiger