Coinbase's Market Share Tumbles to Less Than 3%: Mizuho

The decline likely places Coinbase outside of the top 10 crypto exchanges, based on average dollar volume.

AccessTimeIconJul 14, 2022 at 6:07 p.m. UTC
Updated May 11, 2023 at 6:48 p.m. UTC
10 Years of Decentralizing the Future
May 29-31, 2024 - Austin, TexasThe biggest and most established global hub for everything crypto, blockchain and Web3.Register Now

Coinbase Global (COIN) continues to lose market share to its global rivals and is at risk of greater losses amid the crypto bear market, Mizuho equity research analyst Dan Dolev said in a note to clients.

Dolev estimates Coinbase's average trading volume at roughly $1.2 billion in July, down from nearly $7 billion in November 2021. The company's market share of global trading volume dropped to just 2.9% in July, said Dolev, versus an average of 5.3% in the first quarter of 2022 and a peak of 8-9% in November 2021.

According to Dolev, Coinbase ranked 14th in average trading volume by dollars in July, down from fourth last November.

Binance continues to be the world's largest exchange by volume, posting an average of nearly $11 billion in trading in July, down from $32.9 billion in November 2021.

"This trend is problematic for COIN," said Dolev, as growing exchange competition will require Coinbase to continue raising marketing spend and is likely to weigh on its fee rates. "All this, coupled with subdued volume trends, is likely to weigh on profitability moving forward, in our view."

Dolev continues to rate the shares at neutral and trims his price target to $42 from $45. COIN is up modestly in Thursday action at $53.96.

Goldman Sachs downgraded its recommendation on Coinbase to a sell in late June, saying the exchange will need to make substantial reductions to its cost base to “stem the resulting cash burn” as retail trading activity slows down.

Disclosure

Please note that our privacy policy, terms of use, cookies, and do not sell my personal information has been updated.

CoinDesk is an award-winning media outlet that covers the cryptocurrency industry. Its journalists abide by a strict set of editorial policies. In November 2023, CoinDesk was acquired by the Bullish group, owner of Bullish, a regulated, digital assets exchange. The Bullish group is majority-owned by Block.one; both companies have interests in a variety of blockchain and digital asset businesses and significant holdings of digital assets, including bitcoin. CoinDesk operates as an independent subsidiary with an editorial committee to protect journalistic independence. CoinDesk offers all employees above a certain salary threshold, including journalists, stock options in the Bullish group as part of their compensation.

Author placeholder image

Michael Bellusci is CoinDesk's crypto reporter focused on public companies and digital asset firms.


Learn more about Consensus 2024, CoinDesk's longest-running and most influential event that brings together all sides of crypto, blockchain and Web3. Head to consensus.coindesk.com to register and buy your pass now.


Read more about