Coinbase shares jumped over 9% after JPMorgan upgraded the stock and raised its price target to $404.Coinbase shares jumped over 9% after JPMorgan upgraded the stock and raised its price target to $404.

Coinbase soars 9% after JPMorgan upgrade

Coinbase Global Inc. shares jumped significantly on Friday following JPMorgan Chase’s upgrade of the cryptocurrency exchange, showing new monetization opportunities linked to its Base network and USDC payout strategy.

The bank’s analysts raised their rating to “Overweight” from “Neutral” and increased their price target to $404 per share, suggesting about 15% upside compared to present levels.

JPMorgan noted that Coinbase is doubling down on its Base layer-2 blockchain and seeking to unlock more ways to capture more value from the platform’s growth. 

According to the bank, the launch of a Base token could represent a $12 billion to $34 billion market opportunity, with Coinbase’s retained share potentially worth $4 billion to $12 billion. Analysts suggest that the token’s distribution may give precedence to developers, validators, and the Base community.

The report also highlighted potential margin expansion opportunities from changes to Coinbase’s USDC rewards program. JPMorgan noted that Coinbase may reduce interest rewards for most users, while offering them primarily to Coinbase One subscribers — a move that could add approximately $374 million in annual earnings at current USDC yields and interest rates.

After the upgrade, COIN shares rose more than 9% on Friday to about $353. Data for YoY shows the stock is now up about 42%, pushing Coinbase’s market capitalization to roughly $90.6 billion.

Analysts eye $12B–$34B opportunity from potential Base token launch

Coinbase is scheduled to release its third-quarter results on October 30. According to Zacks Investment Research, analysts anticipate the firm to post earnings of $1.06 per share, marking a 71% year-over-year increase, on revenue of $1.74 billion, a 44.1% increase from the same quarter last year.

The upcoming report is coming on the heels of a mixed second quarter for Coinbase, which missed earnings but achieved several operational milestones, including growing stablecoin balances and revenue derived from stablecoins.

The company has been working to fuel growth in its subscription and services segment, which is expected to contribute $665 million to $745 million in revenue during the third quarter. Among the major events in the quarter, Coinbase highlighted the passage of the GENIUS Act, which establishes a regulatory framework aimed at promoting the adoption of stablecoins within the United States. The company also noted that the House passed a broader market structure bill, seen as a step closer to greater clarity in crypto regulation.

Coinbase’s Echo acquisition revives memories of the ICO boom

On related development, Coinbase Global Inc.’s $375 million buy of digital asset investment platform Echo is evoking some not-so-distant memories—the boom times of less than a decade ago, when thousands of crypto projects raised billions of dollars by selling tokens directly to investors.

Initial coin offerings, or ICOs, helped define the boom-and-bust cycle that made the general investing public aware of cryptocurrency for the first time. While the token sales came to a halt in 2018 after the speculative bubble that quickly developed burst and regulators cracked down on the scams that proliferated, Coinbase’s acquisition is seen by market participants as a signal that what’s old is new again.

According to Coinbase’s statement announcing the acquisition, the company said the deal would help it build a “full-stack” solution for crypto fundraising.

Cobie, the founder of Echo, said the company will continue to operate a standalone platform under its current brand for the time being. Still, he noted that they would integrate Sonar’s public sale product into Coinbase and likely establish new ways for founders to access investors.

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