Coinbase Shares Approach Overvaluation Threshold, Says 10x Research

Shares of Nasdaq-listed cryptocurrency exchange Coinbase (COIN) are nearing an overvaluation threshold, according to 10x Research’s Markus Thielen. He suggests a pair trade strategy: shorting COIN while going long on Bitcoin.

  • Coinbase's trading volumes are not keeping pace with its share price rally.
  • Current prices are approaching a +30% overvaluation threshold, indicating potential underperformance ahead.
  • Thielen's analysis indicates 75% of COIN's price is linked to Bitcoin's price and trading volumes.
  • Coinbase shares have increased by 84% over the past two months, compared to Bitcoin's 14% rise.
  • The stock's valuation appears disconnected from crypto trading volumes, currently around $108 billion.
  • Other market factors, including Circle’s IPO and Korean investor activity, seem priced in.
  • Recent market reversals suggest Coinbase shares may be at risk of hitting a local top.