Wednesday, February 8, 2023
HomeMarketDogecoin Is Worth More Than Coinbase. Investors Sour on the Crypto Broker.

Dogecoin Is Worth More Than Coinbase. Investors Sour on the Crypto Broker.

Dogecoin prices have fallen this year, but not as much as shares in Coinbase Global.

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Dreamstime

Dogecoin
and
Coinbase Global
have both had a lousy year, hit by selloffs sparked by rising interest rates and exacerbated by a string of crypto business failures.

But
Coinbase
(ticker: COIN) just took another blow—even though a purely symbolic one.  

The online platform is now worth less than Dogecoin, a digital asset based on a meme. 

Dogecoin’s market capitalization rose to more than $9.9 billion on Tuesday, numbers from data firm CoinMarketCap show. Coinbase’s market cap hovered at $8.1 billion. In midday trading, the stock was up 1.4%; shares hit an all-time low on Monday.

Also feeling the pain on Tuesday: Coinbase corporate bonds that mature in 2026 were changing hands at distressed-debt levels, yielding almost 20% and trading for 50 cents on the dollar.

The company’s fall is sobering. Shares in Coinbase, which went public in 2021 with a market cap north of $85 billion, are down 85% this year.
Bitcoin,
the leading crypto, is off by 65%.

What happens next for Coinbase, which is still expected to post more than $3 billion in revenue this year, is a key question. 

While the company can diversify its revenue stream—options include interest on deposits and new fees—its core business is suffering.

Coinbase relies on fees from individual trades, but retail investors have fled as the crypto chaos has spread.

To be sure, the Dogecoin-Coinbase market cap race is purely symbolic—but it’s also indicative of how Wall Street is souring on anything to do with digital assets.

Write to Jack Denton at jack.denton@barrons.com

Credit: marketwatch.com

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