Wells Fargo reduced the recommendation for Coinbase shares

Wells Fargo Analysts reduced the recommendation on Coinbase shares to the “below the market”. They referred to the difficulties of crypto -rhines in maintaining profitability, writes Coindesk.

Experts substantiated their opinion by reducing the share of the market market against the backdrop of increased competition. This leads to a decrease in trade fees and a decrease in profitability, they added.

The document for customers says that the path to sustainable profits will be difficult, taking into account current trends in the conditions of preservation of cryptosim.

Analysts estimated the fair value of Coinbase shares at $ 57. On September 29, trading securities ended at $ 61.94. Since the beginning of the year, the capitalization of the company has collapsed by 75.5%.

Recall, in August, agency s&P Global reduced the corporate rating of the exchange with BB+to BB, preserving the “negative” forecast.

Coinbase’s net loss in the second quarter of 2022 amounted to $ 1.1 billion, which doubled the expectations of analysts. Pure revenue in April June decreased from last year’s $ 2.03 billion to $ 803 million. Trade commissions formed 82% of pure revenue.

In August, CEO Exchange Brian Armstrong said that the platform reduces expenses and shifts the focus to the direction of subscriptions and services in cryptosim.

In the same month, Coinbase agreed to cooperate with BlackRock. Customers of the latter will receive direct access to digital asset trading through the Aladdin portfolio control system.

Earlier it became known about the attempts of the platform to make money on propaganda trading. For this, the company allegedly allocated $ 100 million.

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