Analysts from NY investment bank H.C. Wainwright say that Coinbase is uniquely positioned to benefit from the upcoming crypto bull run.
Analysts from the prominent New York-based investment bank H.C. Wainwright have declared an end to “crypto winter.”
The bank has initiated coverage of United States crypto exchange Coinbase with a “buy” rating, saying that the company stands to benefit from the growing cryptocurrency industry around the globe.
In an April 26 note to investors, Wainwright analyst Mike Colonnese observed that overall crypto asset prices had rallied 45% year-to-date, supported by a 67% increase in the price of Bitcoin.
According to the analyst, markets “have likely now entered BTC’s next bull price cycle, which has historically resulted in significant growth in total crypto market cap, incremental retail and institutional adoption, and higher crypto trading volumes.”
“Crypto winter is over, and spring has sprung.”
Colonnese added that Coinbase is “uniquely positioned to benefit from the large and rapidly growing global crypto economy,” given that it stands as the largest publicly-traded crypto exchange in the world. As a result, the investment firm expects the company to expand its market share in the cryptocurrency sector throughout the remainder of 2023.
Colonnese set a price target of $75 per share for Coinbase stock (COIN), a nearly 40% increase from its current trading price of $53.89.
He explained that the new price target is based on an expectation that Coinbase will continue to benefit from the “continuation of crypto’s bullish price action in 2023.” He noted that bullish sentiment typically precedes a Bitcoin halving event, the next being scheduled for April 2024.
Further justifying the $75 price target, Colonnese wrote that the crypto exchange had established a “robust user base,” with 110 million verified and 8.3 million active users throughout 100 countries.
Overall, there are a total of 884 institutions that currently hold investments in Coinbase, according to data from Fintel. This figure marks a 2.1% decrease in ownership from Q4 2022, with the average portfolio weight of total institutional investment in Coinbase decreasing by 15.12% in the same time frame.
The largest institutional holder of Coinbase shares is Cathie Wood’s ARK Invest, which holds 11.7 million shares representing 5.09% ownership of the company. In its last filing to Nasdaq, ARK Invest reported owning 9.2 million shares, representing a quarterly increase of 22%.
Wainwright analysts aren’t alone in believing that the end of crypto winter has arrived. In an interview with Cointelegraph, veteran crypto trader Phillip Swift reiterated his view that the bear market had come to a close. However, the price of Bitcoin could return to “as low as $20,000” before the next bull cycle kicks off, he said.
Ultimately, however, Swift claims that the halving narrative will gather steam in the latter half of this year, “which should increase buy pressure.”