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Is the Coinbase Exchange Overvalued? Should you Consider Using it?



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Coinbase exchange is the largest crypto exchange in the United States of America, according to its trading volume. It stands out among its competitors for several reasons.

The exchange recently shared its second earnings report publicly. The analysts estimated the company will post a transaction revenue of around $1.57 billion. However, Coinbase posted a transaction revenue of $1.9 billion in Q2, which certainly exceeded expectations.

Even though it is an impressive achievement, an investment research company in the USA still considers Coinbase to be overvalued. Let’s find out why this could be so.

Meanwhile, if you are in the USA and are interested in buying crypto assets such as BTC or ETH you can opt for the Kraken exchange. However, if you are not in the USA you can use SwissBorg exchange and invest in the top crypto assets.


For people who are interested in starting crypto trading, one of the top exchanges to use is PrimeXBT Covesting. It allows beginners to copy experienced traders. Sign up with our link today.

Why Could Coinbase’s Value be in Question?

Coinbase is a well-known cryptocurrency exchange, not only in the USA but also around the world. It is a popular name that comes with plenty of expectations. The exchange has exceeded several expectations and grown quite significantly.

The analysts estimated that Coinbase will get around 6.7 million monthly transacting users (MTUs) and 62.8 million total users.

In reality, the exchange successfully got 8.8 million MTUs and 68 million users in total.

The MTUs and trading volume of the Coinbase exchange have been slightly fluctuating in some months in Q2. However, Coinbase has still shown impressive growth in the quarter. But is it enough to satisfy the analysts?

David Trainer, the CEO of New Constructs, has a different opinion and he took to Twitter to share it.

New Constructs offers “unconflicted and comprehensive fundamental research”. It uses the best stock research tools and investment research software to get the results.

According to Trainer, the competition of crypto trading is noticeably increasing, which is why Coinbase is unlikely to “sustain blowout earnings”. Some of the well-known Coinbase alternative exchanges are:

David Trainer continued to state that Coinbase is currently overvalued and needs to achieve a higher revenue as compared to rivals such as NASDAQ and Intercontinental Exchange.

New Constructs CEO also pointed out that the transaction revenue generated for Coinbase heavily depends on the spot price of Bitcoin. Since the price of the flagship digital asset was seen fluctuating a lot, so did the transaction revenue for the exchange.

Should You Consider Using Coinbase?

Coinbase is undoubtedly one of the top crypto exchanges in the USA. Despite some ups and downs, it has shown good progress in the second quarter of 2021. However, the exchange has warned that the outcome may not be so bullish in the third quarter of the year. Considering this, David Trainer has also suggested that the users of Coinbase should be cautious while using the exchange.

There is some uncertainty regarding the achievements of Coinbase in Q3. However, despite the possibility of lower numbers as compared to Q2, Coinbase’s revenue is expanding into other digital assets. This is helping the exchange in capturing the thematic flow of decentralized finance.

Therefore, if you are new to the crypto space you can take caution and use the Coinbase exchange. If not, you can opt for some of the best crypto exchanges mentioned earlier to buy BTC or ETH.

Nevertheless, if you are a margin trader looking to trade Bitcoin and Ethereum with up to 100x leverage you can use Bybit. Use this link to sign up and earn a free bonus on your initial deposit.



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