Stock Market Wipeout Leads To Massive Single Day Decline For Coinbase

Coinbase recently saw its shares experience their largest single-day drop in over two years after the company released its latest earnings report, which fell short of expectations and coincided with a significant downturn in the stock market.

Despite this setback, traders remain optimistic about a recovery for the stock in 2025. On October 31st, 2024, COIN closed at $179.25, marking a 15.34% decrease, the steepest intraday decline since July 26th, 2022, when it dropped 21% during an SEC investigation. After hours, COIN experienced a slight rebound of 1.43%.

Falling Short

Crypto trader Pickle, who has 16,100 followers on X, expressed confidence in the company and its future earnings, predicting a strong performance in Q1 and Q2 of the following year, and suggested that the current market reaction to the earnings call is exaggerated. 

It was reported on October 30th that the Q3 2024 earnings for Coinbase were approximately 11% below what Wall Street had estimated. Still, confidence in COIN remains strong, with Pickle highlighting that the summer months tend to be quieter for all markets, and he anticipates a rise to $600 for COIN. The exchange reported a 27% quarter-over-quarter decline in transaction revenue, totaling $573 million, yet this still represents a more than 98% increase compared to Q3 2023.

Room For Improvement

Market analyst Geert Leysen noted that COIN still holds plenty of potential for growth, especially in relation to Bitcoin (BTC) and its  performance. Traders are also closely monitoring the upcoming U.S. elections on November 5th, which could introduce increased market volatility.

Meanwhile, crypto trader Cable remarked on the surprising fact that COIN is still trading below its IPO price of $250 which was reached in April 2021. Overall, October 31st proved challenging for the stock market, with analyst Andrew Lokenauth reporting that over $950 billion was lost.

In the midst of this volatility, traders noted that MicroStrategy (MSTR), led by Michael Saylor, has surpassed Coinbase in market capitalization, with MicroStrategy now valued at $49.5 billion. In related news, Coinbase recently integrated support for the Bitcoin Lightning Network, a solution facilitating faster and more affordable BTC transactions.