Coinbase is trending after losing around 30 percent since it is capitalized on the stock market. The crypto exchange enters the stock market at a time where Bitcoin was rising. However, investors’ joy turned into a nightmare when Bitcoin lost 50 percent of its value. This loss of capital affected the crypto platform, and since then, it is yet to recover.
The financial system that Coinbase shared in the months leading to May was excellent compared to its image today. According to economists, the crypto platform is likely to continue to lose value.
Coinbase is affected by the downtrend
The crypto exchange is going through a worse time as the current trend for crypto is unfavorable. With a downtrend, investors are not interested in buying tokens which somehow affects Coinbase. Doubt, uncertainty, and fear take over users who do not dare to buy or sell their cryptos.
However, the crypto exchange took a different view in the first quarter of the year when it raised $1.8 billion. The company even had a good figure when compared to the income it had in 2020.
But cryptocurrency trading has lost 40 percent of its share since the price crash in May. Crypto was affected by China regulations and later by restrictions imposed by the UK. By July, crypto purchases plunged below $65.8 billion each day.
Crypto buying is at its worst moment
Coinbase does not have unique features that distinguish it from other cryptocurrency crypto platforms. The crypto exchange offers to purchase, sell, and exchange crypto assets under an anonymous system, just like the other 300 existing platforms. However, something that can identify the crypto platform from the rest forces the customer to verify their identity to make transactions.
The platform also has only 50 tokens, including Bitcoin, for adoption. Coinbase has also lost customers because it is not as big as other crypto platforms. The main competition of the crypto company is undoubtedly Binance that handles over 100 cryptos and has more affordable prices.
At the moment, the company has $63.5 billion in capitalization. This figure is excellent, but it is likely to lose capital by the end of the year. The crypto company may be dying and could even be preparing to leave the market.
Based on the cryptocurrency experts’ opinions, Coinbase only needs an update to improve its work. If the crypto exchange admits more tokens, its outcome for 2021 may be different.