What is Coinbase
Coinbase Global, Inc., also known as Coinbase, is a cryptocurrency trading platform based in the United States. Coinbase is a remote-first company (decentralized organization) with no physical headquarters. The company now employs over 2,700 people worldwide and supports dozens of different cryptocurrencies.
Coinbase has over 100 million users in over 100 countries, and consumers trade $327 billion per quarter. Coinbase is in charge of a thriving bitcoin ecosystem that includes over 9,000 financial institutions.
Coinbase offers two different trading platforms as well as a cryptocurrency wallet service. You're likely to find all you need to create and manage a bitcoin portfolio or trading plan among the Coinbase products.
Coinbase is a publicly traded company, making its stock available to anyone of legal age interested in purchasing shares.
What are Coinbase Shares (COIN)
Coinbase shares represent a unit of ownership in Coinbase Inc. – and they are considered to be amongst the most traded financial instruments around the globe. The company received positive feedback on the efficacy of its COVID-19 vaccine, Coinbase this race during the pandemic, causing its share price to jump.
Coinbase shares will rise and fall in value according to how well the company is performing at a given moment in time. Better-than-expected earnings will make Coinbase share prices rise, while weaker earnings will make share prices fall. However, there are many reasons why a company's share price can change.
People trade Coinbase shares because, just like other financial instruments, they can be an opportunity to invest money. At a basic level, you can take a position on Coinbase shares to get exposure to economic growth. If an economy is in good shape, you might find that companies operating in that specific economic branch or industry will grow too.
Company growth is correlated with share price increases, which is what people are hoping for when they buy Coinbase shares.
On April 14, 2021, the U.S. cryptocurrency exchange Coinbase went public, with its shares opening at $381. This marks a milestone in the world of cryptocurrencies, as Coinbase is the first pure-play crypto trading company to list on a U.S. exchange.
Coinbase’s IPO could be a way for more traditional investors to gain crypto exposure without feeling like they’re jumping straight into the game of speculation.
If you’re more comfortable investing in stocks and putting your money behind a company with cash flow, a board of directors, and the whole traditional infrastructure, you’ll appreciate the opportunity to bypass crypto volatility and invest in Coinbase stocks instead.
When you invest in a company, you're not only expressing trust in the company, but you're also indicating that you expect demand for its product or service to increase. Do you think cryptocurrencies like bitcoin, Ethereum, and the thousands of altcoins accessible on Coinbase have a future? Do you think bitcoin is the "future of money" that will usher in a "global open financial system," as Coinbase claims on its website?
Is this merely a passing fad? Coinbase is particularly subject to swings in demand, and if bitcoin loses its allure and consumers quit exchanging on the platform, income might suffer.
Before investing in a pure-play crypto company, just as you'd want a complete understanding of the renewable energy sector before investing in a renewable energy company, you'll want to fully grasp cryptocurrencies.
Coinbase stock is traded on the Nasdaq stock exchange under the COIN ticker.
If all that makes you want in on Coinbase’s fintech growth, here is everything you need to know to buy Coinbase stock & shares to invest in COIN.
How to Buy Coinbase Shares
Learning how to buy shares may not sound complicated, but you will need to do some research — and learn the basics — before making your first investment.
- Learn the difference between investing and trading
- Review Coinbase’s performance and outlook 2022
- Understand the risks and charges
- Access the trading platform and place your orders
- Stay up to date with the latest news and rumors about Coinbase
1. Learn the difference between investing and trading
People have two options to buy shares of stock online. Firstly, they can buy shares in companies on the exchanges where they are listed. For instance, you can buy Coinbase stock on the NASDAQ exchange, so you own a share in the company (investor). Alternatively, they can buy Coinbase shares without owning them, speculating on the price of the underlying asset (trader).
Investing and trading are similar terms that some people will sometimes use interchangeably – but there are significant differences for you to be aware of.
Investing in Coinbase Stock
Investors buy Coinbase shares hoping their price will rise and they can sell them later for a profit, adhering to the basic principle of buying low and selling high. Investors will take positions over a longer period, attempting to profit from share price changes as well as dividend payments.
While this means that they might need more initial capital to get started when compared to trading, their losses would be capped at this initial price tag. That said, investors should be aware they might get back fewer returns than they initially invested.
Investors will buy Coinbase shares to:
- Make a profit from the Coinbase share price rising
- Receive an income from dividends if the company pays them
- Benefit from the effects of compounding
This last point requires investors to hold onto their shares for an extended period. That’s why you’ll sometimes hear the phrase ”time in the markets is better than timing the markets” when talking about share investments.
>> Learn how to invest in stocks
Coinbase (or any single stock, for that matter) can be a very volatile investment. You can lower the risk by diversifying your investment holdings.
An index fund is a type of mutual fund or exchange-traded fund (ETF) with a portfolio constructed to match or track the components of a financial market index, such as the Standard & Poor's 500 Index (S&P 500). An index mutual fund provides a broad market exposure, low operating expenses, and low portfolio turnover. These funds follow their benchmark index regardless of the state of the markets.
COIN currently is not included in a major stock index
Blockchain exchange-traded funds (ETFs) provide exposure to the performance of companies within the global cryptocurrency industry.
COIN makes up 12.16% of BKCH (Global X Blockchain ETF), 9.94% of BITQ (Bitwise Crypto Industry Innovators ETF), 8.57% of DAPP (VanEck Vectors Digital Transformation ETF), 6.09% of VFNX (Simplify Volt Fintech Disruption ETF), 5.46% of FINX (Global X FinTech ETF).
>> Learn what ETFs are and how do they work
Trading Coinbase CFDs
On the other hand, traders might seek to capitalize on short-term share price gains. Rather than investing in the shares, traders speculate on the shares’ value. They can speculate on it rising by going long, as well as falling by going short.
Trading Coinbase stock means that you are speculating on a share’s price movements with derivatives like CFDs. In other words, you are purchasing Coinbase shares without taking direct ownership.
Leverage is available when you use this product, giving you full market exposure for an initial deposit – known as margin – to open your position.
For example, a trader who wanted to buy 100 Coinbase shares CFD at $200.00 per share would only require $4,000 of trading capital, thereby leaving the remaining $16,000 available for additional trades.
But keep in mind that leverage can increase both your profits and your losses as they will be based on the full exposure of the trade, not just the margin requirement needed to open it. This means losses, as well as profits, could far exceed your margin.
With CFDs, you can ‘buy’ (go long) the shares if you think the Coinbase stock’s price will rise, or you can ‘sell’ (go short) if you think the Coinbase stock’s price will fall.
>> Learn what is CFD trading and how it works
Going Long Coinbase CFD
Coinbase has a sell price of $260.00 and a buy price of $265.00.
Coinbase’s next earnings announcement is fast approaching, and you expect it to be good news.
You think the company’s share price will go up, so you buy 200 Coinbase CFDs at $265.00 This is the equivalent of buying 200 Coinbase shares.
Because in CFD trading you can use leverage, you do not need to put up the full value of Coinbase shares. Instead, you only need to cover the margin, which is calculated by multiplying your exposure with the margin factor for the market you are trading.
So, if Coinbase has a margin factor of 20%, your margin would be 20% of the total exposure of your trade (200 share CFDs x $265.00 = $53,000), which is $10.600.
If your prediction is correct:
When Coinbase announces its results, it is clear the company had a successful quarter and as you had predicted, its share price climbs.
You decide to close your position when it reaches $300, with a buy price of $300.00 and a selling price of $295.00
You reverse your trade to close a position, so you sell your 200 CFDs for $300.00
To calculate your profit, you multiply the difference between the closing price and the opening price of your position by its size. $300.00– $265.00 = $35.00, which you multiply by 200 CFDs to get a profit of $7,000.
If your prediction is wrong:
Coinbase’s results are worse than expected, and its share price immediately falls. You decide to cut your losses and sell your 200 CFDs at $250.
Your position has moved $15 against you, meaning you suffer a loss of $3,000.
Going Short Coinbase CFD
Shorting with derivatives can be an effective way to protect your investments against downward price movements in your non-leveraged investment portfolio. Also, it can be a way to generate profits outright from shares that are falling in value. But when you go short, your potential losses are theoretically uncapped because there is no limit on how high a company’s share price can rise.
Here is an example:
Suppose Coinbase shares are currently trading with a selling price of $250.00, and you think the price will go down. So, you decide to open a short CFD position on 100 Coinbase shares CFD. A week later, the buy price reaches $200.00, and you close your position. This means you made $10,000 in profit ([250.00 - 200.00] x 200 = $10,000), excluding additional costs.
If the price rises, you register a loss. For example, if Coinbase shares rose to a price of $275, you would suffer a $5,000 loss instead, excluding additional costs.
When you create a trading account with CAPEX, you will be able to:
- ‘Buy’ (go long) or ‘sell’ (go short) Coinbase and other 2,000 international shares to speculate on their price rising or falling
- Take a position on our range of ETFs to get exposure to a basket of shares from an entire country, index or sector that could be rising or falling in price.
- Trade a host of global indices to go long or short on the performance of an entire economy with a single trade.
- Use QuantX, the smart portfolio builder that helps you cover the popular industries and only invest in the top-performing stocks.
2. Review Coinbase’s Performance and Outlook 2022
Before buying Coinbase stock—or any stock (see our guide on how to buy shares)—it’s wise to do some research into the company’s financials, performance, and outlook. The easiest place to get started is through a company’s annual reports and quarterly reports. Public companies like COIN are required to publicize detailed information about their financial health in these.
You can find these on Coinbase’s investor relations site or by searching the Securities and Exchange Commission’s (SEC) database.
You may also turn to experts for their input. Brokerage companies frequently release commentary on major stocks and industries, and third-party evaluators like Trading Central provide comprehensive technical and fundamental analysis.
When you combine financial data with expert insight, you will be able to decide how much of your money you want to put into Coinbase stock.
Coinbase Shares Forecast - Fundamental
Before you load up the trunk with Coinbase shares, pop opens the hood and see what you are really getting into. Remember, when you buy Coinbase stock, you are purchasing a small portion of an actual business:
Coinbase is a cryptocurrency trading platform based in the United States. Coinbase is a remote-first company with no physical headquarters.
Coinbase's balance sheet, income statement, competition, and management (all explained in our guide on how to research stocks) will help you give the company a good once-over.
You can access research, analyst ratings, and other key information about Coinbase via your brokerage account or a financial information website. If you like what you see, your next step is to consider whether Coinbase fits into your current investment portfolio.
- Coinbase's market capitalization is $64.734B
Despite a surge in crypto prices and trading activity that has extended into the current quarter, the cryptocurrency exchange released third-quarter earnings on Nov. 9 that fell short of expectations. Coinbase's earnings per share were $1.62. That was lower than the $1.82 forecast by FactSet. The corporation brought in $1.235 billion in revenue. For $1.614 billion, that was a squandered opportunity.
Earnings increased by 295 percent year over year, while revenue increased by 316 percent compared to the previous year.
The number of monthly transacting users fell to 7.4 million from 7.6 million in the previous quarter. During that time, the trading volume also decreased.
*Last update: December 2021. Source: Yahoo Finance
Coinbase has never declared or paid a cash dividend and does not intend to pay.
Coinbase Shares Forecast - Technical
Technical traders analyze price charts to attempt to predict price movement. The two primary variables for technical analysis are the time frames considered and the technical indicators that a trader chooses to utilize.
Our web-trading platform, for example, offers 6 chart types (including the famous Japanese candlestick chart) to help you analyze price performance across different timeframes. It also enables you to deal in an instant – directly from the charts. You will be able to open, close and edit positions in just a couple of clicks.
Trading charts always feature distinct patterns that technical analysts can use to interpret the behavior of buyers and sellers. These chart patterns can give traders an indication of where the market could go next. As you will notice when you look at a chart, the market will usually move in one overall direction or trend. There are three types of market trends: uptrends, downtrends, and sideways trends.
From a technical perspective, the Weekly Coinbase price chart is neutral.
COIN stock is trading about 50% off its post-IPO highs and may re-test the all-time lows at the beginning of 2022. Bulls will wait for a false breakout of the key support level $200+ to buy Coinbase shares at the lowest price that keeps a positive.
To buy Coinbase shares or not?
It is recommended to watch for stocks in the major long-term support area. We should buy Coinbase shares at relatively cheap prices (compared to historical values), not expensive prices. Also, have an exit plan for how you will exit a profitable trade. Define how and why you will exit. Since we used to support to get into the trade, you may consider exiting just below a long-term resistance level.
If buying at support, and planning to exit just below resistance, the upside potential should outweigh the downside risk by at least 2:1 or even 3:1. That means that if you buy Coinbase shares at $220, you should be reasonably able to get out of the stock at $195 or higher. In an absolute worst case you lose $25 a share, but based on the historical chart it is quite feasible to go up to $50/share or more. This is known as the risk/reward ratio, a key indicator when deciding to buy Coinbase shares or not.
With CAPEX WebTrader, you can perform an in-depth analysis of the charts with 90 indicators (including moving average, MACD, RSI, and Bollinger Bands). The platform also supports an interactive trading activity with high-end research tools helping you interpret market data.
Analyst consensus - STRONG BUY
Strong Buy based on 16 analysts offering recommendations for Coinbase stock in the last 3 months, the overall consensus is strong buy (by analysts ranked 3 to 5 stars):
- 81.3% Buy (13)
- 6.3% Sell (1)
- 12.5% Hold (2)
The price target on Coinbase - $398
Based on 16 analysts offering 12-month price targets for Coinbase in the last 3 months, the average price target is $398, with a high estimate of $600 and a low estimate of $160.
3. Understand the risks and charges
Trading can be seen as riskier than investing due to leverage. But investing also carries a risk – and there is no guarantee that your investments would increase in value, so you could receive back less than you initially invested.
Before deciding to trade in shares, you should take steps to manage your risk. We have courses at CAPEX Academy that take you through risk management and how to mitigate your exposure to risk in the financial markets.
Our costs and charges for trading vary depending on the product that you use to take a position.
Coinbase (COIN) CFD Trading Conditions
|SPREAD PER UNIT||3.48 pips||LEVERAGE||1:5|
|OVERNIGHT ROLLOVER - LONG||-0.0076 %||OVERNIGHT ROLLOVER - SHORT||-0.0063 %|
|INITIAL MARGIN||20.0000 %||MAINTENANCE MARGIN||10.0000 %|
- Spread represents the difference between ASK price and BID price.
- Future Rollover adjustment consists of the difference in price between expiring contract and new contract as well as the spread of the CFD.
- Swap is the amount credited to or debited from an account where positions are held overnight.
- Inactivity fee represents the monthly amount deducted if no activity is recorded for 12 months in an account.
4. Access the trading platform and place your orders
To buy Coinbase shares CFD with CAPEX Webtrader is very easy and intuitive. Opening an online trading account is as easy as setting up a bank account. Here are the steps:
Open an account or log in
First, create an account or log in on capex.com. To open an account, click the "Register" button and complete your details.
Once the platform is accessed, the registration process must be completed in order to operate with real money. Click "Complete the Registration and Start Trading".
To log in, from the CAPEX website, click on "Login".
Deposit funds into your account
To trade with a live account, it is necessary to deposit funds. This is done from the platform itself by clicking on the "Add funds" button:
Also, it is possible to trade on a risk-free demo account with a balance of € 50,000, which is ideal for getting to know the platform and testing trading strategies.
CAPEX offers you different payment methods: debit cards, credit cards, bank transfer, skrill, and more.
It is noteworthy that CAPEX does not charge any fees or commissions for depositing funds.
Look for Coinbase shares
To view Coinbase shares (COIN) real-time price and chart on the trading platform can click on the "Search" icon located in the left panel or by clicking on "Shares" and then select the instrument, in this case, Coinbase.
Use the indicators and drawings to analyze the chart
Click the indicators icon and select your favorite ones. There are trend-following, oscillators, volatility, and support/resistance indicators available. To learn how many indicators to use and how to combine then visit the Technical Indicators section in CAPEX Academy.
Set up the order to buy Coinbase shares
To buy Coinbase shares CFD, click on the "Buy" button and a window is displayed to configure the purchase order:
The number of Coinbase shares to be purchased must be entered and it is allowed to set up a Stop Loss to limit the potential loss, and/or a Take Profit to close a profitable position once the Coinbase stock reaches a specific price. These orders can be configured based on price, pips, cash value, or percentage.
To proceed with the purchase, click on "Place Order".
However, COIN trading does not end here. You will want to check out the next step to make sure you are investing your money as well as you can.
Why Trade Coinbase with CAPEX?
- Advanced AI technology at its core: Whether they prefer the web-based and mobile-ready WebTrader or favor the highly popular MetaTrader 5, we make sure investors make effective use of fast and reliable trade execution speeds, complex order and risk management tools, advanced charting options, powerful research tools in collaboration with highly-regarded platforms such as Trading Central or TipRanks.
- Trading on margin: Providing trading on margin (up to 5:1 for individual equities), CAPEX gives you access to the stock market with the help of CFDs.
- Trading the difference: When trading Coinbase CFD, you do not buy the underlying asset itself, meaning you are not tied to it. You only speculate on the rise or fall of the Coinbase stock price. Online trading with CFDs is nothing different from traditional trading in terms of strategies. A CFD investor can go short or long, set stop loss, take profit, and apply trading scenarios aligned with their objectives.
- All-round trading analysis: The browser-based platform allows traders to shape their market analysis and forecasts with sleek technical indicators. CAPEX provides live market updates and various chart formats, available on desktop, iOS, and Android.
- Focus on safety: CAPEX puts a special emphasis on safety:
- capex.com is a website operated by KW Investments Limited, which is authorized and regulated by the Seychelles Financial Services Authority, license number SD020.
- capex.com is operated by Key Way Investments Ltd and is authorized and regulated by the Cyprus Securities and Exchange Commission (CySEC) (license no. 292/16).
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- Global partnerships: CAPEX is proud to be the Proud Sponsor of Juventus, one of the most prestigious football clubs in the world, a football club that has a special place in the hearts of the people of Italy, with a strong legacy and a dedicated community.
5. Stay up to date with the latest news and rumors about Coinbase (COIN)
Get the latest Coinbase Inc. (COIN) stock news and headlines to help you in your trading and investing decisions.
History of Coinbase
Brian Armstrong, a former Airbnb engineer, started Coinbase in June 2012. Armstrong received a $150,000 capital infusion after enrolling in the Y Combinator company development program. Former Goldman Sachs trader Fred Ehrsam eventually joined as a co-founder. Ben Reeves, a British programmer and co-founder of Blockchain.info, was meant to be part of the Coinbase founding team, but he split with Armstrong right before the Y Combinator financing event over their differing views on how the Coinbase wallet should work. Coinbase transactions, which are special transactions that enter cryptocurrency into circulation in proof of work cryptocurrencies, inspired the company's name. The company began offering services to buy and sell bitcoins via bank transfers in October 2012.
The startup secured a $5 million Series A investment from venture capital firm Union Square Ventures in May 2013, managed by Fred Wilson. The startup secured a US$25 million investment from venture capital firms Andreessen Horowitz, Union Square Ventures (USV), and Ribbit Capital in December of the same year. In the same year, Vassar College graduate Olaf Carlson-Wee was hired as the company's first employee.
In 2014, the company reached one million users, bought Blockr, a blockchain explorer, and Kippt, a web bookmarking service, obtained insurance to cover the value of bitcoin held on their servers, and introduced the vault system for secure bitcoin storage. In 2014, the company has formed partnerships with Overstock, Dell, Expedia, Dish Network, and Time Inc., allowing them to accept bitcoin payments. In the same year, the company introduced bitcoin payment processing capabilities to Stripe, Braintree, and PayPal, which are all traditional payment companies.
Draper Fisher Jurvetson, the New York Stock Exchange, USAA, and other banks led a $75 million investment in the company in January 2015. In January, the company established Coinbase Exchange, a bitcoin exchange for professional traders based in the United States. Coinbase launched services in Canada and Singapore in September.
The company relaunched the Coinbase Exchange as the Global Digital Asset Exchange in May 2016. (GDAX).
They added Ether retail support in July.
They also declared in July that they would cease operations in August following the shutdown of Canadian online payments service provider Vogogo.Coinbase received the BitLicense and was licensed to trade in Ethereum and Litecoin from the New York State Department of Financial Services between January and March of 2017. (DFS). The US Internal Revenue Service ordered Coinbase to notify any users who had at least $20,000 in transactions in a year in November. Coinbase listed Bitcoin Cash on December 19, and the Coinbase platform witnessed pricing anomalies, prompting an insider trading probe.
Coinbase notified about 13,000 affected customers on February 23, 2018, that their taxpayer ID, name, birth date, address, and historical transaction records from 2013 to 2015 would be provided to the IRS within 21 days. Emilie Choi, a former LinkedIn employee, was named Vice President of Corporate and Business Development by Coinbase in March. In May of this year, she was promoted to president and chief operating officer. Coinbase confirmed their intention to support ERC-20 tokens on March 26, 2018. On April 5, 2018, Coinbase announced the formation of Coinbase Ventures, an early-stage venture fund focused on blockchain and cryptocurrency-related firms. Coinbase Ventures made its first investment in Compound Labs, a start-up that creates Ethereum smart contracts that are analogous to money markets, on May 16. GDAX was renamed Coinbase Pro on May 23. Coinbase Prime, a platform for institutional investors, was also introduced in May.
Due to a suspicion of a network assault, Coinbase halted all Ethereum Classic trading in January 2019. Coinbase revealed in February that it had purchased Neutrino, an Italy-based "blockchain intelligence platform," for an unknown sum. Because of Neutrino's founders' ties to the Hacking Team, which has been accused of providing internet monitoring technologies to nations with terrible human rights records, the acquisition alarmed some Coinbase users. Coinbase CEO Brian Armstrong claimed on March 4 that his business "did not adequately examine" the purchase from a due diligence standpoint, and that as a result, any Neutrino employees who previously worked at Hacking Team "will transition out of Coinbase." In April, a UK corporate filing stated that Coinbase's non-U.S. revenue grew 20% to €153 million (U.S.$173 million) in 2018 resulting in a net profit of €6.6 million. According to Coinbase UK CEO Zeeshan Feroz, the company's non-US activities accounted for roughly half of the company's revenue.
During the global Coronavirus pandemic in May 2020, the corporation stated that it would become "remote-first" and would no longer recognize a formal headquarters. In May, the company announced the $75 million to $100 million acquisition of New York-based digital asset trading firm Tagomi. In June, Coinbase's CEO Brian Armstrong faced internal pushback after first refusing to make a remark regarding Black Lives Matter, citing the company's apolitical culture, but Armstrong then reversed his position on Twitter. In September, Armstrong wrote a blog post underlining that Coinbase will not engage in social activism, citing how such activity has harmed other Internet companies like Google and Facebook, and offering a severance payout to employees who disagreed.Employees also complained that they were being treated unfairly because of their color or gender. Coinbase announced the introduction of a Visa debit card program in October. The New York Times revealed in December that, based on statistics up to 2018 (which was already two years old at the time of publication), women at Coinbase were paid 8% less than men in comparable professions and ranks, while Black employees were paid 7% less than those in similar roles.
Coinbase parent Coinbase Global took a move toward an initial public offering in January 2021, and the business filed for a direct listing to go public with the Securities and Exchange Commission in late February of that year. The US Office of Foreign Assets Control investigated the company in March, citing concerns that it may have provided blockchain services to blacklisted individuals or companies, noting that the nature of blockchain technology makes it "technically impossible" to prevent specific users from transacting. In March, the business also agreed to pay $6.5 million to settle regulatory allegations that it misrepresented its trade volumes. Coinbase also stated in March that it would open a corporate presence in India and hire personnel for IT services such as engineering, software development, and customer support.The company recorded a nine-fold growth in Q1 revenue to $1.8 billion, up from $190.6 million the prior year, in its penultimate results announcement before its April 14 public offering. The increase was due to the rise in Bitcoin's price over that time period. Nasdaq set a reference price of $250.00 per share prior to the offering, valuing the firm at $47 billion. Coinbase closed at $328.28 per share at the end of its first day of trading.
*Last Update: November 2021. Source: Wikipedia