The Coinbase share price (NASDAQ: COIN) climbed by more than $14 today, almost nine percent, to $181.31 in a matter of hours.
This is the highest the Coinbase share price has been since March 2022. But why the sudden movement?
What is Coinbase and Coinbase wallet?
Coinbase Global, Inc. is a cryptocurrency exchange platform based in the United States, and is one of the world’s largest crypto exchanges by volumes traded.
Among its offerings are Coinbase Wallet, which allows you to buy, sell and hold various cryptocurrencies in a secure digital wallet that can be accessed via your mobile phone or a computer.
This has served Coinbase well. In fact, in the year-to-date, Coinbase’s share price is up by more than 15 percent.
Why is Coinbase trending?
The reason for Coinbase’s sudden popularity is manifold. Most recently, on February 18th, Coinbase revealed that its platform Coinbase Commerce will no longer be supporting Bitcoin and similar UTXO coins.
This means that users of the platform must have a Coinbase account in order to use Bitcoin directly to make payments.
This was not due to a lack of demand. It was because maintaining the feature, according to a post on X by Coinbase’s Head of Product Lauren Dowling, “was challenging & we therefore made the difficult decision to remove native Bitcoin & other UTXO support.”
But this alone does not explain why Coinbase’s share price is its highest in close to 24 months.
Why is Coinbase at its highest stock price in two years?
The reason Coinbase’s share price is performing well, despite this controversial news, is that Coinbase announced its full-year 2023 financial results in an earnings call last week.
In the results, the company reported $273.4 million in profits during Q4 of 2023 alone, amounting to $1.04 per share. This was the company’s first quarter of profit in more than two years. This was a staggering, parabolic improvement compared with the year before’s Q4 2022 loss of $557 million.
Shortly afterwards, the Coinbase share price unsurprisingly rocketed up 13 percent on the day, before correcting back downward slightly to close almost nine percent higher that day at $180.29.
The Coinbase stock price has only gone from strength to strength since then, in spite of both the United States (where Coinbase is based) and Canada being closed for holidays today.
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