According to research published by JPMorgan, the centralized and publicly listed crypto currency exchange known as Coinbase Global Inc. had a marginal increase in trading volume during January 2023.
The fall of FTX and Coinbase's gradual development into a trustworthy platform are both seen to have contributed to the rise in the volume of crypto currency exchanged on Coinbase in January.
The JPMorgan Report Findings
Even though there have been more hacks, rug pulls, and persistent bear market conditions, the corporation has not disclosed any severe network outages. In any event, the crypto currency exchange has kept a high degree of safety for storing crypto currencies, which is insured by the FDIC limited to a total of $250,000 per customer.
According to statements (1) made by analysts working for JPMorgan, "We think Coinbase has been establishing a reputation as a reliable and trustworthy middleman for some time." As activity levels begin to improve, our country's business is helping to generate a higher market share.
Coinbase has been successfully luring more institutional investors despite the bear market of 2022 because of the platform's over 108 million verified users and its quarterly crypto currency trading volume of over $159 billion. Additionally, the bitcoin exchange wasn't directly involved in the crisis FTX and Alameda were experiencing.
According to what JPM wrote, "unlike several Coinbase's high-profile peer group, Coinbase did not have significant exposure to FTX and was shielded from the specific legal and institutional blowback from its demise."
Interestingly, crypto currency exchange Coinbase has published (1) a documentary on Amazon Prime on the company's ascent to the status of a billion-dollar technology enterprise in fewer than ten years.
Coinbase has earlier indicated, during the results of the 2022 third-quarter earnings report, that the company anticipates a significant decrease in trading volume due to the migration of crypto currency trading to DEXs and outside markets. In addition, most exchanges in the United States are on the verge of going bankrupt due to rigorous regulatory requirements.
According to the company's commentary (2) in the earnings report for the 22Q3 quarter, "for 2023, we are preparing with a cautious attitude and expecting that the present macroeconomic challenges will stay and probably deepen."
Coinbase has gained considerable backing from institutional investors, one of whom is Cathie Wood's Ark Invest, which has made many acquisitions over the previous two months. This endorsement comes on the heels of a strong market forecast. According to information presented by Cathiesark.com, the current value of ARKK Holdings on Coinbase is somewhere in the vicinity of 3.01 percent.
Notably, Coinbase's stock market is just as volatile as the digital asset market because of its significant direct connection to crypto currency. According to data compiled by MarketWatch, COIN shares finished the day of January 24, selling around $53.56 despite seeing a decline of 4.3 percent throughout the trading session.
Despite this, COIN shares have increased by around 64 percent over the past month. This increase correlates with Bitcoin's breakout to $23,000 throughout the past few weeks. Coinbase, which now has a market valuation of $12.7 billion, is in a strong position to see exponential growth alongside the crypto currency market in the years to come.