Coinbase’s (COIN) cryptocurrency trading volumes in the U.S. appear to have weakened more than expected in the third quarter, investment bank Berenberg said in a research report on Tuesday.

The crypto exchange’s trading volume fell around 17% sequentially and by about 52% year-on-year, the Berenberg report said, citing The Block. Coinbase will report its third-quarter results on Nov. 2.

“We continue to view COIN’s consumer take rate as being at risk of compression due to competition for market share within a lower volume crypto space,” the bank said.

Analyst led by Mark Palmer said that, “The primary driver of our cautious stance towards Coinbase Global is not our concern about the company’s operating performance during the next couple of quarters, but rather on the threats to its business from the various regulatory actions and litigations that it faces in the U.S., as well as others that it could face in the future as the regulatory crackdown on crypto continues.”

The note said that political headwinds could blunt the impact of the exchange’s ramped-up lobbying efforts, adding that recent headlines about Hamas’ use of crypto are likely to make the question of crypto’s legal status “even more elusive.”

Despite the ongoing crypto winter and the various regulatory challenges faced by Coinbase, its shares are trading at a valuation close to that at which they traded in late 2021, which was the height of the last crypto boom, the report added, noting that the stock has risen more than 112% this year versus a 72% gain for bitcoin (BTC) and a 29% uplift for the Nasdaq stock index.

Berenberg reiterated its hold rating on Coinbase stock and the $39 price target. Coinbase shares closed at $77.46 on Tuesday.

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