Goldman Sachs further reiterated how the crashing Bitcoin value can still be beneficial for the exchange in the long term business and termed it as a tactical trade for the exchange.
Goldman Sachs, the New York-based investment bank, has asserted that the cryptocurrency platform is likely to defeat the second-quarter estimates and has called it a tactical trade. The memo of the bank has said that the bitcoin prices that have been going down can be an opportune time for Coinbase to generate revenue in the form of fees as volatile BTC prices have led to an emerging trade volume that can be proven beneficial for the exchange. Goldman Sachs addtionally confirmed that even if the prices of Bitcoin are susceptible to fluctuations, the Coinbase exchange can still earn substantial revenue by collecting fees and gaining profits through them.
Coinbase to Flourish ahead Despite Experiencing Volatile Bitcoin Prices
Goldman Sachs has said that Coinbase Global Inc (NASDAQ: COIN) will continue to seek profits even at the time when Bitcoin prices are crashing. The profit generated will be derived through fees that the exchange will earn during crypto transactions and future proceedings.
Goldman Sachs which is the leading investment banking firm headquartered in New York has confirmed that the exchange is likely to defeat the Q2 estimates and calls it a tactical trade for the exchange to experience at such times.
The banking firm has emphasized that Coinbase revenue will be generated in the form of fees acquired via high rent payment by the users because the volatile bitcoin prices will result in rising trade volumes which will automatically become quite an opportunity for the exchange to levy regulatory fees and earn maximized values and gains in return.
Even at the times when Bitcoin might experience market fluctuations in prices, the nervous users registered on the platform still initiate transactions that can fetch considerable earnings in the form of fees for the exchange.
According to Will Nance, an Analyst at Goldman has reportedly said that the exchange had previously experienced a decline in shares with an average of 25% but the investors have now started the process of “reengaging” to beat the coming quarter values and transform it into a profitable circumstance.
Will Nance has also stated that the significant erratic nature of BTC which has led to a boom in trading crypto volumes can be proven extremely effective for the exchange. The volatile BTC prices can lead the users to trade crypto using high rents which can render the exchange with a substantial proportion of revenue raked in, in the form of fees.
Juhi Mirza is an archaeology major who is obsessive about blockchain/Crypto technology and deems it to be the foundational philosophy of the future. Her dogged ability to research and crystallise technical facts/multiple perspectives into rivetting stories makes her an accessible finance writer. She tends to her archaeological pursuits and loves unearthing the past over the weekends.