- Coinbase stock hit a new all-time low of $40.62 on Monday.
- The stock is down more than 39% since the beginning of November and 80% from its all-time high of more than $400.
- Coinbase bonds are also at all-time lows. Its 2031 notes fell 15% in November alone and are trading at about 50.5 cents on the dollar.
- The low price of COIN indicates that investors are not willing to risk investing in the crypto company amid the chaotic environment created by the FTX bankruptcy and upcoming regulatory scrutiny.
Cryptocurrency exchange Coinbase (NASDAQ:) saw its stock plunge to a new all-time low of $40.62 on Monday. This comes amid the chaos of FTX inflation and waning confidence in centralized cryptocurrency exchanges.
US stocks are currently trading at around $42, which is down nearly 80% since the start of the year, according to data from Yahoo! finance. Coinbase was trading at over $400 with a market capitalization of $85 billion at the time of its IPO on Nasdaq last year.
Coinbase’s share price has been hit hard by the fallout from rival FTX, which filed for bankruptcy on November 11th. In this month alone, Coin’s share price has fallen by more than 39%, from $69 to around $42. This is despite the exchange saying it has no physical exposure to FTX.
Coinbase bonds are also at all-time lows. Its bonds due in 2031 fell 15% in November and are currently trading at 50.5 cents on the dollar, indicating that investors think there is a high chance that the stock exchange will default on its bonds in the near future.
Coinbase has also seen revenue decline as the broader crypto market continues to experience significant price declines. The stock exchange recorded a 50% decrease in revenue in the third quarter of this year compared to the same quarter of last year, as well as a loss of $545 million. Coinbase cut its workforce by 18% in June, followed by another cut of 60 jobs in November.
Crypto stocks continue to crash
But Coinbase isn’t the only crypto stock crashing. MicroStrategy (MSTR) maxed out on Michael Saylor to $154 on Monday before rising to $162, which is 40% lower than it was at the start of the month.
MicroStrategy bonds also took a hit. The price of its 2028 bonds fell to a record low of 72.5 cents on the dollar on Monday, while yields rose to 13.35%.
Silvergate (SI), one of the world’s leading banks specializing in cryptocurrencies, has also seen its shares get crushed since the beginning of November. SI is currently trading at around $26. That’s almost 60% less than what it was worth on November 1st. And while the bank said the FTX fiasco had no effect on it, the movement in its share price may indicate otherwise.
The broader crypto market has seen a significant drop in its value. The total cryptocurrency market cap is currently around $806 billion. That’s down nearly 73% from last November’s high of over $3 trillion, according to data from CoinMarketCap. Bitcoin (BTC) and (ETH) are both down around 77% from their all-time highs, while most altcoins are down 90-99%.
on the flip side
- Coinbase said it is not exposed to FTX material.
- Coinbase is one of the most regulated centralized cryptocurrency exchanges. This should calm investors and users.
- The exchange has been around since 2013 and has survived many bear markets.
Why should you bother
Coinbase is perhaps the most regulated centralized crypto exchange in the world. However, its share price decline shows that investors are not willing to take the risk of investing in the business in the chaotic environment created by the FTX collapse.
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Coinbase and MicroStrategy Stocks Drop to Record Lows in FTX Bankruptcy