Coinbase Shares Decline By 9% Following Profitability Warning From Wells Fargo

Coinbase (COIN) shares plunged by more than 9.3% as U.S. markets opened on Thursday after Wells Fargo issued a profitability warning.

The multinational financial services company claimed rising competition and macro pressures will hurt the publicly traded crypto exchange, dubbing COIN a sell, according to a CNBC report. 

Wells Fargo set a price objective of $57 for Coinbase

With analyst Jeff Cantwell suggesting that the current difficult environment will put downward pressure on the exchange, Wells Fargo set a price objective of $57 for Coinbase. Cantwell also cited the downgrade’s contributing cause as the reduction in retail pricing.

Throughout the summer, Coinbase has faced pressure, and Cathie Wood’s Ark Invest dumped COIN shares valued at about $75 million at the time. Even if the price did increase once BlackRock’s alliance was announced, the company’s earnings seemed underwhelming. The exchange stated that it anticipated third-quarter underperformance.

Competition from competing exchanges, like Binance and Robinhood, which this week entered the self-custody wallet market.

As volumes on North American platforms keep declining, the US lowering fees on several spot pairs has put more pressure on the exchange.

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