TL;DR Breakdown
• Coinbase bets its shares on cryptocurrencies.
• PayPal and MasterCard join the crypto market.
Coinbase, the largest cryptocurrency exchange in the United States, announces first-quarter earnings. This crypto company closed its operations with the exchange in April after Bitcoin took off in 2020. With this rise of Bitcoin, the shares held by this company fell frantically.
The company reported that in recent days it has shown how fickle Bitcoin can be. On Wednesday, Tesla CEO Elon Musk said he would eliminate buying his vehicles with Bitcoins. This announcement boomed on the networks because Musk has been the primary supporter of cryptocurrency.
Coinbase and its earnings
Wall Street is estimated to expect the company to earn $3.07 per share on revenue of $1.81 billion. This figure will be attached to the forecasts of the crypto exchange that controls Coinbase now.
The company in April indicated that it expected 56 million users in its registry, to have 6.1 million per transaction each month. How lucky Coinbase will be with the balance will depend on how interested people are in trading Bitcoin. Coinbase, which makes most of its profit from exchange fees, said that the demand for BTC is unpredictable.
Coinbase forecasts regarding cryptocurrencies
The exchange company gave three predictions regarding cryptocurrencies and their trading. The company forecasts a potential $4 million to $7 million of average users with monthly transactions, based on their value and interest in crypto.
But regulators continue to be wary of cryptocurrencies and want to act on fraud or digital theft. There are also some concerns about the energy that Bitcoin mining is consuming.
If Coinbase continues to invest in cryptocurrencies, it could have more competition shortly. Block One, a Blockchain software company, wants to enter the crypto market in 2021.
Shares owned by Coinbase are down 5% to $269.21 in the current market. Their composite rating is 49, while the BPA rating is 70. Since the mid-April, these shares have been trading with a value of $250 per share.
Bitcoin fell 8% to $49,710 last Thursday. GBTC plummeted 7%, and MicroStrategy fell 6% after investing $15 million in cryptocurrency. In April, MicroStrategy announced that its holding in BTC was worth $5 million.
Coinbase later said that the sentiment towards Bitcoin grew incredibly throughout 2020, backed by NFT and DOGE. But the PayPal digital payment system is allowing users to buy cryptocurrencies. Mastercard has also joined the game to motivate investors to buy Bitcoins.
The rise in investment in Bitcoin was also attributed to the growth of alternative tokens that emerged after COVID.
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