Should You Be Buying Coinbase Stock?


Author: Jeffrey Taylor

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Coinbase finally released its initial IPO and sent the investing world into a frenzy. This is the first major mix of traditional Wall Street investing and cryptocurrency, so a lot of people are eager to learn whether or not they should be investing.

It’s hard to say how Coinbase is going to perform over time. Unlike other companies, its performance is linked to that of the crypto market. As we all well know, crypto is known for being volatile, so there’s a possibility that volatility bleeds into Coinbase’s long-term share price.

We’ve seen signs of this already with how Coinbase’s share price has changed since offering that IPO, in line with a dramatic fall in value for the cryptocurrency market as a whole.

As Bitcoin continues to see losses, we’re seeing a knock-on effect that has driven Coinbase shares down.

However, it’s difficult to say whether that’s a result of the turbulence crypto is facing or simply the value of Coinbase shares finding a base level to work off of.

Coinbase opened its IPO at $250. It didn’t take long for investors to start pouring into the company, though, with it soon reaching gains of over 70% at $429.54.

It closed out trading that day at $328.28, up over 30% from that IPO figure.

Currently, Coinbase is trading around $291.60, down yet again from that closing figure. However, it is still up from its initial IPO by a fair margin, remaining an attractive investment.

Wait on Coinbase

That being said, experts are advising that you wait out the current market before casting a bet on Coinbase.

As is the case with many companies’ IPO, it has yet to establish a base level of support for the share. This means that there is no way to analyze and gauge a buy-in point, resulting in increased risk regardless of when or how you decide to invest.

What Coinbase’s IPO Means for Crypto

Coinbase’s IPO serves as a validation for the cryptocurrency industry and one that it desperately needed.

Crypto is still trying to prove itself as a viable powerhouse in the world of modern finance, so efforts to bridge the gap between it and traditional trading are important.

With the success that Coinbase has seen so far with this IPO, it could set a precedent for cryptocurrency trading platforms in the future.

If more brokers follow suit, then we can expect a massive change in the cryptocurrency landscape as more money flows into the market.

However, it’s hard to judge how the impact of increased volatility in the likes of Ethereum and Bitcoin can affect efforts like this in the long term.

Given that crypto brokers’ profits are directly linked to trading volumes, which are, in turn, linked to the success of coins, it’s possible that shares are going to follow after Bitcoin.

If that happens, it’s likely that many traditional traders are going to avoid Coinbase stock as they have cryptocurrency, deeming it too risky compared to stocks belonging to more traditional companies and corporations.

Wrap Up

In summary, you should wait before pulling the trigger on Coinbase stock. No patterns or levels have been formed in its charts, meaning it’s impossible to perform analysis on when you should be buying into the market.

If you do decide to invest now, be wary and proceed with caution. A union between stocks and cryptocurrency like this is unprecedented, so there aren’t many people capable of making educated estimations on how Coinbase is going to perform.

BWCEvent aspires to share balanced and credible details on cryptocurrency, finance, trading, and stocks. Yet, we refrain from giving financial suggestions, urging users to engage in personal research and meticulous verification.


Jeffrey Taylor is a retired mechanical engineer who has an interest in all things financial, including emerging markets and cryptocurrencies.