Bitcoin price falls below $40K, plus factors impacting Coinbase stock

Bitcoin (BTC-USD) has fallen more than 10% since the Securities and Exchange Commission’s approval for spot bitcoin ETFs. One company that is exposed to the ups and downs of the crypto market is Coinbase (COIN).
Owen Lau, Executive Director at Oppenheimer, joins Yahoo Finance to discuss the state of bitcoin and the impacts it can have over financial institutions, investors, and the crypto market itself.
When asked about the how the price of bitcoin impacts Coinbase, Lau states: “I would say this is one of the most important factors for now. The other important factor is they are going on a lawsuit with the SEC. So there’s still a regulatory overhang. We still don’t have clear regulations in the United States right now, even though there are more clarity outside of the United States. So I would call out bitcoin price, the SEC lawsuit and also I think the overall health of the industry are all important factors for Coinbase.

About Yahoo Finance:

Yahoo Finance provides free stock ticker data, up-to-date news, portfolio management resources, comprehensive market data, advanced tools, and more information to help you manage your financial life.

– Get the latest news and data at finance.yahoo.com

– Download the Yahoo Finance app on Apple (https://apple.co/3Rten0R) or Android (https://bit.ly/3t8UnXO)

– Follow Yahoo Finance on social:

X: http://twitter.com/YahooFinance
Instagram: https://www.instagram.com/yahoofinance/?hl=en
TikTok: https://www.tiktok.com/@yahoofinance?lang=en
Facebook: https://www.facebook.com/yahoofinance/
LinkedIn: https://www.linkedin.com/company/yahoo-finance

Bitcoin extending declines now trading near $39,000 the optimism over spot Bitcoin ETFs evaporating and the declines are also hitting crypto related stocks including coinbase joining us now is Owen Lao Oppenheimer executive director and Senior analyst Owen it’s good to see you so some of your colleagues Owen um making headlines today they’re getting

You know not getting kind of pessimistic skeptical on coinbase and they’re worry here as they’re watching Bitcoin they watch these Bitcoin spot ETFs on maybe a kind of sell the news event do you share that that caution here Owen I think first so first of all thank

You for having me um I think in the near term the stock could be volatile because think about that if you go back to coinbase the stock was up 400% in 2023 and bitcoin price was also up a lot and there was a sell the news event happening after the spot beon ETF

Approved I do think that in the near term there may be some downward momentum on bitcoin until the next catalist so I would say near term you you you probably see the the stock to be pretty a volatile for coinbase Owen is the Bitcoin price the most important factor for coinbase’s stock

Price I would say this is one of the most important factors for now the other important factor is they are going on a lawsuit with the SEC so there’s still a regulatory overhang we still don’t have a clear regulations in the United States right now even though there are more

Clarity outside of the United States so I would call bitcoin price the SEC lawsuit and also the um I think the overall health of the industry are all important factors for coinbase and ow I’m also interested when we talk about coinbase the business um and you look at non-trading Revenue Owen what percentage

Is of that is now the total and how do you see that sort of evolving from from here because obviously they they put a lot of emphasis and priority in diversifying the business right yeah at the end of the third quarter I would say around 50% half of the revenue came from

Non-trading and those Revenue came from interest income and also blockchain uh income which is the revenue they got from the usdc stable coin they a revenue sharing agreement with with circle and then the other smaller Revenue items are uh the sticking uh revenue and also custody Revenue so you’re right that

Coinbase has been making a lot of effort to diversify away from from just trading so that’s why Bitcoin is important but not the I I I wouldn’t say it’s like only one Bitcoin like only Bitcoin is the U like predominant Factor um and then when we look at the Bitcoin ETFs at

As well right um there was a lot of debate sort of ahead of time as to whether this is going to be a boon or neutral or even negative for coinbase so now that the introduction is come and gone what do you think so when we look

At the fourth quarter trading volume so when we bake in a lots of the optimism of Bitcoin spot Bitcoin ETF approval there are two key things that I think not many people talk about number one Bitcoin price went up a lot and coinbase generate Revenue base part of part on

The price of Bitcoin the second point was about higher trading volume so what that means is this Bitcoin uh ETF can bring in new investors it support higher prices it also support higher trading volume that actually benefit coinbase longer term so to me I think it’s a net positive for coinbase longer term

Because it bring you new investors what about the risken uh to the extent maybe you even see it as a risk that investors now say you know what um I want exposure to bitcoin and I’m going to do it through a spot Bitcoin ETF where you

Know there’s been kind of this race the bottom on fees anyway I’ll go that way rather than buy Bitcoin on on the coinbase platform that’s a very good point so we expect some investors in particular some institutional investors will move away from coinbase to ETF because of the lower fee you just talked

About but think about that spot Bitcoin ETF it’s just one use case which is the speculation use case if you trade on coinbase there are 240 other tokens that you can engage with not just Bitcoin and also you can also engage with other use

Cases like Defi and web 3 so to me what I believe is I believe a vast majority of customers would stay with coinbase because of they access to web 3 and Divi and some other use cases Owen good to catch up with you thanks a lot appreciate it thank you for having me