Crypto Winter Could Recede From Coinbase And Robinhood This Quarter, Analysts Say

Oh, feel that chill? It’s a crypto-winter that doesn’t want to go away.

Unfortunately, the crypto-winter that came after the market crash in 2022 has chilled activity in the digital asset industry and shaken the prices of guardian tokens like Bitcoin and Ether.

But analysts’ hearts are slowly thawing, giving hope that trading platforms  Robinhood Markets, which has a significant crypto-brokerage sector, and Coinbase Global will warm up the trading environment soon.

As you can guess, although these trading platforms have suffered due to volatility and other market issues, such as a lack of market investors within a year, they have performed quite well in the third quarter. Because of that, Wall Street expects cryptocurrency trading volumes on both platforms to increase by the end of the year, as well as steady growth through 2023.

At Robinhood, Mizuho Securities analyst Dan Dolev is optimistic about the growth of non-core brokerage businesses after a recent meeting with CEO Vlad Tenev and CFO Jason Warnick.

And as we all know, Robinhood Financial Services is known for offering its clients the ability to trade stocks and exchange-traded funds commission-free through a mobile app introduced back in March 2015. And Robinhood is still focusing on and constantly updating the application. So on the 7th of November, platform executives have already promoted upcoming products, including a retirement account and a cryptocurrency wallet for self-storage. That makes more sense why Wall Street is so optimistic about the platform revenue.

Likewise, Mizuho Financial Group Inc. is also positive about Robinhood’s Gold subscription service, called “Gold Account,” which includes reallocating customer balances into higher-yielding deposits.

What comes to rating of the platform: Mizuho rates Robinhood as a “Buy” with a target price of $14, while analysts from FactSet rate Robinhood as a “Hold” with an average target price of nearly $13.

However, analysts are also positive about Coinbase because of the subscription and services providing platform. This is good enough news for Coinbase because it means they are one step ahead of their competitors, especially amid growing pressure on pricing.

Lisa Ellis, an analyst at Moffett Nathanson, said that she believes Coinbase’s business will likely spike at some point in 2024, making the stock’s current valuation very attractive.

Ellis also believes that cryptocurrencies are just in a trough that will probably end in 12 to 18 months, in line with what they did half a year ago. She noted that even in the challenging environment that we are having right now, Coinbase has stable revenue and healthy outcomes, including a user base and assets under management, and subscription and service revenue is growing.

When it comes to Coinbase’s performance valuation, analysts from FactSet rate the stock of Coinbase as a “buy” with an average target price of $83.75, up nearly 45% from Monday’s $58. However, Ellis rates Coinbase at “Outperform” with an incredibly bullish target price of $200.