What happened
Coinbase Global ( COIN -1.72% ) investors lost a little coin on Monday, as their stock fell by 2% on the day. Since the company is mainly a facilitator of cryptocurrency trading, as the wider crypto market goes, so goes its share price.
So what
It was actually more advantageous for crypto investors to hold stock in Coinbase on Monday than in many of the coins and tokens it tracks. Bitcoin, ever the bellwether, was down by nearly 8% on the day, while Ethereum was experiencing a 10%-plus drop.
Image source: Getty Images.
There have been few factors supporting the rise of cryptocurrencies generally over the past few days. Meanwhile, several — such as last week’s latest Congressional hearings on the subject, which again pointed to tightened regulation for the sector in the near future — are dampening investor enthusiasm, if anything.
What might also be rocking Coinbase stock is today’s news about a peer exchange, Binance. Monday morning, Reuters reported that Binance’s Singapore affiliate said it would withdraw its application to operate in the wealthy Asian country.
That puts a small dent in the prominent exchange operator’s operations, as it had been allowed to conduct business there while the application was pending. However, like the recent Congressional hearings in the U.S., it illustrates the official resistance cryptocurrencies and exchanges still often face around the world.
Now what
Crypto fans generally, and Coinbase bulls specifically, shouldn’t be too moved by the typical up-and-downs in this very up-and-down sector. Coinbase is still experiencing very hot growth, with big leaps in both user base and revenue of late. The cryptocurrency company also very profitable. Current investors should very much consider staying the course, and disregarding this latest dip.
This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis – even one of our own – helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.
