Coinbase Global
stock was climbing Monday as the price of
Bitcoin
continued to rise. A crypto frenzy shows little sign of stopping, boosting sentiment across the digital-asset space—and broker
Coinbase
could benefit from the trading activity.
Shares in Coinbase surged 6.8% to $219.80 on Monday with Bitcoin prices gaining 6.9% over the past 24 hours to $66,355.43. The largest crypto was nearing its record high above $69,000 reached in November 2021. While the action in token prices is adding to the good mood for crypto stocks—already benefiting from upbeat investor sentiment in wider markets, with the
S&P 500
and
Nasdaq
at record levels—Coinbase’s trading business stands to materially gain.
The company’s core business remains its brokerage, where it collects transaction fees from buying and selling cryptos. This business tends to do particularly well during periods of volatility and bullish runs, when investors pile into tokens. While a notable amount of the current price action appears to be driven by inflows into spot Bitcoin exchange-traded funds (ETFs), it is also likely that spot trading has picked up.
Indeed, total crypto market volumes have risen 48% over the past 24 hours, according to data group CoinMarketCap, which is owned by the exchange Binance. If this pace of trading continues, Coinbase’s brokerage is likely to see growth in fee revenue, which could suggest there is upside to current estimates for the first quarter. With the stock up 75% in a month as of Friday’s close, however, these benefits could be more than priced in—to say nothing of the debate over whether Coinbase stock even really trades in line with financial fundamentals.
More broadly, crypto stocks are tearing higher because of the jubilant mood in digital assets, which are trading at the best prices since before a brutal bear market swept over tokens through much of 2022 and 2023. Bitcoin miner
Marathon Digital
stock was down 1.7% Monday to $26.57, but has surged 321% over the last 12 months.
Stock in
MicroStrategy,
a business intelligence group with vast corporate holdings of Bitcoin, popped 19% on Monday to $1,286.96.
Write to Jack Denton at jack.denton@barrons.com
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