Coinbase: It’s worth owning some COIN
A lot happened this week. Bitcoin hit new ATH’s and crypto is showing signs of market rotations. Our current views on the crypto market are the following:
- Crypto bull market cycle intact
- Bitcoin valuations haven’t peaked
- Macro picture mixed but favorable
- Crypto cooling off would be heathy
- Institutions more cautious on crypto
- Signs of retail money entering picture
- Still favor buying GBTC over spot Bitcoin
- Still see Ethereum outperforming Bitcoin
- Size leadership shifting to retail midcaps
- Exchange tokens to DeFi sector rotation
We want to give folks a sense what we’re seeing in the market broadly but we’re not going to go into the above this week. Instead, we’re going to focus our note on our thoughts about the Coinbase public offering.
Coinbase (COIN) went public via a direct listing on Wednesday. This was the most highly anticipated crypto industry offering of the year.
In some senses, it went very well. The company technically traded up ~30% from the reference price of $250 and closed at $332 on the day. During the day, COIN shares hit a high of $429 giving the company a market cap that briefly surpassed the $100B mark.
But in another sense, I think the COIN offering tells us something else very interesting about the market – institutions may be getting more c...Reports you may have missed
CME Basis Suggests We Are Near a Tradable Low, Plus Some Thoughts on Positioning Ahead of the Election
A ROUGH STRETCH AMID RISING UNCERTAINTY SKEWS RISKS TO THE UPSIDE The past five trading days have been challenging for the crypto market, marked by significant uncertainty stemming from various geopolitical and economic events. Among the notable sources of market distress are:GEOPOLITICAL TENSIONS: Iran’s missile attack on Israel has led to heightened anticipation of an Israeli response, with oil prices spiking to $74.NATURAL DISASTERS: A devastating hurricane in the Southeast...
PBOC ONE-UPPING THE FED This week, China’s central bank initiated what we believe are the first steps in a broader effort to stimulate the economy, which is struggling to meet its annual growth target of around 5%. These new measures are aimed at reviving economic activity and restoring confidence, especially in the real estate and equity markets, both of which are facing significant challenges. The People’s Bank of China (PBOC)...
OUR VERDICT: POWELL NAILED IT Yesterday, Powell did exactly what risk assets wanted him to do—their actions were dovish, with a 50-bps cut and guidance for two more by year-end, but their economic commentary remained reassuring. Many bears point to this as hawkish, and since it's hawkish, it's implicitly bad for risk assets (including crypto). In our view, if Powell had taken a significantly more dovish stance than he did,...
INITIAL THESIS – SENATE MORE IMPORTANT THAN MANY RECOGNIZE This week, we witnessed what was the first – and potentially final – presidential debate between Kamala Harris and Donald Trump. Anticipation for this event was high, with the public initially favoring Trump, as reflected in prediction markets. This preference was largely attributed to Harris's lackluster debate track record. However, the dynamics shifted during the debate itself, with reactions in prediction...