As global trade disruptions cast doubt on Coinbase’s trading outlook, the platform’s market share remains strong amidst recession concerns and tariff tensions.
Tariff Tensions Cast Doubt on Coinbase‘s Trading Outlook
Analysts at ‘Oppenheimer’ have lowered their trading volume forecast for Coinbase from $1.6 trillion to $1.3 trillion due to concerns over tariff tensions and their impact on retail crypto activity.
The Impact of Tariffs on Retail Trading
The investment bank cites recession concerns linked to President Trump‘s fluctuating tariff policies as a key driver of reduced retail trading. Despite a generally more supportive tone from Washington, the market has not fully embraced the shift towards a more pro-crypto stance. Analysts believe that the uncertainty surrounding tariffs is driving bear market concern and pulling back retail trading.
Tariff tensions refer to the disputes and conflicts arising from trade agreements, tariffs, and taxes imposed by countries on imported goods.
These tensions can lead to trade wars, affecting global economies and industries.
According to a study, 70% of businesses experience increased costs due to tariff changes.
The US-China trade war, for instance, has resulted in over $360 billion in tariffs since 2018.
Tariff tensions often stem from protectionist policies aimed at safeguarding domestic industries.
Coinbase‘s Market Share Remains Strong
Coinbase is a leading American cryptocurrency exchange platform that allows users to buy, sell, and store digital assets.
Founded in 2012 by Brian Armstrong and Fred Ehrsam, the company is headquartered in San Francisco, California.
Coinbase supports over 100 cryptocurrencies, including Bitcoin, Ethereum, and Litecoin, with more than 35 million registered users worldwide.
However, Coinbase‘s market share in U.S. spot crypto trading remains strong at 69%. The platform accounted for 69% of U.S. spot crypto trading volume in February, gaining ground against rivals like ‘Robinhood‘. Maintaining this lead will depend on whether the market can shake off tariff jitters and regain momentum.
Long-Term Potential Remains Uncertain
Oppenheimer remains optimistic about Coinbase‘s long-term potential, citing its position as a focused leader in crypto with optionality in tokenization and payments use cases. However, the near-term outlook is uncertain due to the ongoing policy uncertainty surrounding tariffs. The analysts have cut their shares price target to $279 from $388, but still maintain an outperform rating on the stock.
A Rebound Stock if Tariff Tensions Deescalate
Analyst Owen Lau believes that Coinbase could be a strong rebound stock if tariff tensions deescalate. In his view, the platform can command a premium due to its focused leadership and optionality in tokenization and payments use cases.
