In last month’s markets report, Ghosts of Cycles Past, we postulated that we are at the very early innings of a new market cycle. We put forward the bull case for why this might be occurring, and a few ideas of where readers can look to capitalize on this thesis. This month, we will be putting forward the bull case for Coinbase and how it fits into our broader thesis from last month… but not in the traditional sense.
Wall Street currently values Coinbase like a boring boomer stock, focusing solely on interest incomes and transactional volumes. Suffice to say, the Street does not have an optimistic view of Coinbase’s future in the near term. However, markets are forward-looking, and we believe investors will soon view Coinbase through a dramatically different lens.
This report will focus on three new revenue drivers we believe Wall Street is sleeping on. Some have more potential to make an immediate impact on Coinbase’s revenue, while others are longer-term bets that position Coinbase at the center of one of the biggest secular trends that is crypto.
These include:
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Going Global – the launch of Coinbase International, an international perps and derivatives exchange
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Staying Local – the core Coinbase exchange business and domestic markets
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Moving Onchain – Base Chain, and its potential direct and indirect impacts on Coinbase’s fundamentals
We believe Coinbase is uniquely positioned at the intersection of traditional finance and crypto, and will benefit tremendously as a new cycle begins to emerge.