Analysts at U.S. bank %Citigroup (NYSE: $C) have upgraded the stock of %Cryptocurrency exchange %Coinbase (NASDAQ: $COIN) to a “buy” rating from “neutral” previously.
Citigroup also raised its price target on Coinbase’s stock to $345 U.S. per share from $260 U.S.
The analysts said in a note to clients that Coinbase is likely to benefit from an improving regulatory environment in the U.S. after the presidential election this autumn, as well as from trading activity related to new cryptocurrency exchange-traded funds (ETFs).
The upgrade of Coinbase stock comes as spot %Ethereum (CRYPTO: $ETH) exchange-traded funds (ETFs) are expected to begin trading on U.S. exchanges today (July 23).
The U.S. Securities and Exchange Commission (SEC) has given a green light for Ethereum ETFs to launch six months after the Wall Street regulator approved spot %Bitcoin (CRYPTO: $BTC) ETFs.
Several fund issuers plan to launch spot Ethereum ETFs today (July 23), including %BlackRock (NYSE: $BLK), Fidelity and VanEck.
Analyst estimates peg the net inflows into the new crop of Ethereum ETFs at between $15 billion U.S. and $20 billion U.S. during their first 18 months on the market.
The arrival of spot Ethereum ETFs could give a boost to Coinbase Global, the largest crypto exchange in the U.S., which relies on trading activity for its revenue and profits.
Citigroup also says in its note that the potential for additional cryptocurrency ETFs and the increased adoption of cryptocurrencies more broadly could also provide tailwinds to Coinbase.
The stock of Coinbase has risen 166% over the last 12 months to trade at $263.09 U.S. per share.
Citigroup acknowledges the big run-up in Coinbase’s share price but says that additional upside opportunities have gotten too big to ignore with the stock.
