Stocks of publicly traded, crypto-focused companies are extending their recent slide, reflecting jitters about where the broader market is headed.
The largest U.S. exchange,
Coinbase Global Inc.
has tumbled 79% from its all-time high in November 2021 when bitcoin reached record levels of $67,802.30. The company’s stock is off 34% so far this month.
California-based
is set to report earnings Tuesday after market close. Analysts expect a first-quarter loss of a penny a share, according to FactSet, down from $3.05 a year ago.
The company had its stock market debut on April 14, 2021, and share prices rose as high as $429.54 in the first few minutes of trading and ended the session at $328.28. The stock has fallen 77% since then.
Coinbase’s
market capitalization fell to $17.27 billion on Tuesday from roughly $32 billion in mid-April. Since the firm derives substantially all of its revenue from transaction fees, lower trading volumes recently have hurt revenue.
Other crypto stocks have also seen big drops.
Silvergate Capital Corp.
has fallen 39% so far this year,
Marathon Digital Holdings Inc.
has slid 62%,
Riot Blockchain Inc.
has slipped 65% and
TeraWulf Inc.,
a bitcoin-mining company, is down 80%.
The Federal Reserve last week raised interest rates by a half of a percentage point, the largest hike in over two decades, pushing investors to further dump shares of speculative companies. The prospect of more half-percentage point increases has sparked declines in stocks and bonds with money managers nervous about the end of the easy-money era when risky bets prospered.
Crypto stocks closely track cryptocurrency prices, often falling or climbing in tandem. This year, however, crypto stocks are faring worse than digital currencies. Bitcoin is down 45% this year, while ether has slid about 40%. On Tuesday, bitcoin prices ticked up, rising 0.4% to $31,075.70 from Monday’s 5 p.m. ET levels.
The third-biggest stablecoin, TerraUSD, which is meant to keep its value at $1, fell as low as 69 cents on Monday, causing a flood of investors to sell their holdings.
This year’s rout has punished large-cap tech stocks, too.
Netflix Inc.,
parent
Meta Platforms Inc.
and
Amazon.com Inc.
are all down more than a third this year. Meanwhile, the tech-oriented Nasdaq Composite has fallen 25%.
Sentiment on nonfungible tokens, or NFTs, has also cooled down, signaling a widespread unwinding of risky bets.
For now, investors await consumer-price inflation data due out Wednesday. If data suggests inflation has peaked, analysts say it could potentially influence the Fed’s aggressive tightening plan.
Write to Hardika Singh at hardika.singh@wsj.com
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