Despite potential unprofitability and legal challenges, Coinbase’s stock rose ahead of its earnings report thanks in part to JPMorgan’s rating upgrade.
Trading on Coinbase (COIN) opened up by 6% in the first hour of the day on Feb. 15, boosted by rising token prices and a recent rating upgrade by JPMorgan analysts.
After downgrading the crypto exchange stock in January, JPMorgan analyst Kenneth Worthington changed his tune and revised the stock rating from underweight to neutral, citing the positive impact of Bitcoin (BTC) exchange-traded funds (ETFs) on crypto markets. Worthington reportedly wrote to clients on Feb. 15:
Bitcoin ETFs amassed over $10 billion in assets under management in their first month of trading, exceeding most analysts’ predictions with solid demand for the crypto investment vehicle. Coinbase’s custody arm has partnered with a majority of asset managers that launched Bitcoin ETFs in January. These products are anticipated to yield between $25 million and $30 million in fees for the company.
