Barclays Analyst: Bitcoin ETF May Provide Limited Benefits for Coinbase Stock
Galaxy Investment Partners CEO, Mike Novogratz, is optimistic that the Securities & Exchange Commission (SEC) will approve a Spot Bitcoin ETF by the end of this year. However, Barclays analyst, Benjamin Budish, believes that this approval will provide limited benefits for Coinbase Global Inc., causing uncertainty for Coinbase stock.
Mike Novogratz’s Positive Outlook on a Bitcoin ETF
Last week, the SEC chose not to appeal a court’s ruling that allowed Grayscale to convert its flagship trust into an exchange-traded fund. Galaxy itself has filed for a Bitcoin ETF in collaboration with Invesco. During a CNBC interview on “Squawk Box,” Novogratz expressed his optimism:
“Dialogue with SEC is heading in the right direction. It is no longer talking about how Bitcoin works. It’s just a recognized macro asset, and that’s a huge psychological shift.”
Novogratz believes that the approval of a Bitcoin ETF will have a positive impact on the market. However, Barclays analyst Benjamin Budish has a different perspective when it comes to Coinbase stock.
Barclays Analyst’s View on Coinbase Stock
In a research note to clients, Budish stated that the approval of a Bitcoin ETF is unlikely to result in significant profit and loss benefits for Coinbase. While Coinbase will serve as a custodian for at least four BTC exchange-traded funds, Budish believes that the company is unlikely to earn substantial custodial and prime brokerage fees.
Barclays currently has an “underweight” rating on Coinbase stock with a price target of $70, which suggests a potential 6.0% downside from its current value.
It appears that there is a difference of opinion among industry experts regarding the potential impact of a Bitcoin ETF on Coinbase stock. While Novogratz is optimistic about its potential benefits, Budish remains doubtful about significant gains for Coinbase.
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