The Coinbase share price (COIN) has continued to plumb new depths on news that the company is raising $1.5 Billion via a convertible bond offering.
Investors in Coinbase can’t catch a break of late. The western world’s largest cryptocurrency exchange, listed on the 14th of April this year, to much excitement. The same day that marked the top for Bitcoin.
Analysts estimated that COIN would commence trading around $250. In fact, the Coinbase share price far exceeded those expectations and debuted 70% higher at $388.98
Opening day trading saw COIN as high as $428.95. This took exchanges’ market cap above $100 billion. It also marked the peak of the share price.
At last night’s closing price of $239.30, the stock has lost 44% from that high. Furthermore, it is trading below its expected listing price for the first time.
Coinbase Share Price Outlook
The Nasdaq listing could not have come at a worse time for the Cryptocurrency exchange. As I mentioned in a previous report, the Coinbase share price is heavily reliant on Bitcoin trading.
Therefore, the 30% drop in the crypto leaders’ value since the stocks’ debut has been negative for the share price.
As crypto investors have diversified from BTC and into the Ethereum based assets that participate in Decentralized finance and Decentralized Apps, a further headwind has emerged.
Many of these coins/tokens are not listed on the exchange. Resulting in rivals reaping the benefits of the recent bull run in Altcoins.
News that the company is now looking to raise capital is adding more downward pressure on the stock.
It’s hard to say where the price heads next. Much will depend on how the Cryptocurrency market, especially Bitcoin, recover from the latest decline.
The 30-minute price chart shows a descending trend at $247.00, from the 12th of May high at $306.60. A break above this trend may see a technical rally that would target the 14th of May high at $280.50.
A failure to hold the lows at $238.50 would signal that the recent weakness may not be over yet.
Traders should, of course, pay close attention to the price of Bitcoin as this is highly correlated to that of Coinbase.