This story originally appeared on Best Stocks.
Shall I buy Coinbase stock?
Analysts think you should. There are several reasons to buy Coinbase stock, but the main one is due to the company’s commitment to making bitcoin – along with litecoin and ether – a mainstream currency.
Coinbase has been on a buying spree, acquiring more companies that offer different types of digital currencies. With these acquisitions, the company is one step closer to becoming a global financial institution for cryptocurrency.
Cryptocurrency has become the talk of the town. With Bitcoin reaching an all-time high, it is becoming more and more popular. It seems like everyone you meet is asking about what cryptocurrency is and how they can get involved. And while most people want to get in on the action, not everyone knows where to start.
But there is a company that has been around for years and specializes in making it easy to buy cryptocurrency: Coinbase. Coinbase was founded in 2012 and has grown exponentially since then; they currently have over 10 million users (and growing). So what makes Coinbase stock such a great investment? We have listed below the 3 main reasons.
Citi has upgraded Coinbase as a buy
In a note to clients on Tuesday, Coinbase was given a buy rating, stating that the stock is now a less ess riskier investment.
“Despite its significant exposure to cryptocurrency prices, COIN provides investors with direct exposure to increased retail and institutional adoption.”
According to Citi, Coinbase should be able to expand its business as the crypto industry develops.
Coinbase shares have recently gained traction, rising in seven of the last eight sessions and gaining more than 30 percent. However, the stock has yet to return to the levels seen on its IPO day in April, when it briefly traded above $400 per share.
Coinbase is the biggest crypto-market in the world
Coinbase is one of the most popular exchanges for buying and selling Bitcoin, Ethereum, and Litecoin. By using Coinbase wallet, you can also buy or sell Bitcoin directly from your mobile device. This is why many analysts think that Coinbase is among the best stocks to buy.
Since its inception in 2011, Coinbase has been on a mission to create an open financial system for the world by building a bridge between fiat money and crypto. To do so, the company must grow its customer base from those speculative traders looking to gamble on cryptocurrency price swings to everyday people who want to have some exposure to digital assets as part of their long-term portfolio.
Coinbase is the first place in the world where you can buy and sell Bitcoin. Coinbase’s in-house Bitcoin store currently allows you to purchase Bitcoin with PayPal, Mastercard, American Express, and several major credit cards, as well as purchasing Ethereum with a debit or credit card. Bitcoin provides a reliable, near-frictionless way to conduct business with people in more than 100 countries without a bank or broker.
Along with its exchange and wallet services, the company also offers two trading platforms that allow you to buy and sell all three cryptocurrencies: Coinbase Pro and Coinbase Trade. Coinbase Pro is a more stripped-down version of the Coinbase trading platform that doesn’t have the most sophisticated trading engine, but it still allows you to trade in Ether and Bitcoin.
For the sake of clarity, it needs to be added though that there are some risks associated with Coinbase. The first thing to know about Coinbase is that it is not a bank. Coinbase does not hold your financial assets on its own balance sheet, nor do you hold them on Coinbase’s balance sheet. Instead, Coinbase uses third-party custodians to hold its customers’ assets. Coinbase also offers no guarantee on the reliability or safety of the assets you invest in, nor does it have the legal authority to redeem or transfer the assets when required.
Crypto is the next gold
David Tepper, compares Bitcoin – and more in general cryptos – to gold.
“I have some.” It’s only a small amount. “It’s really because my son was into it,” Tepper explained. He didn’t say what cryptocurrency he owns.
“I’m not a big fan of cryptocurrency.” “I wish it was this year,” Tepper said, referring to the massive gains made by digital assets such as bitcoin so far in 2021. Based on Friday’s trading price of around $61,200 per coin, it’s up more than 100% year to date.
Bitcoin, on the other hand, continued to retreat from all-time highs reached earlier this week on Friday. Bitcoin reached a high of around $67,000 at one point.
Bitcoin supporters frequently refer to it as a long-term store of value, implying that it should be included in a portfolio to protect against inflation.
Tepper stated that he, to some extent, agrees with that viewpoint.
“I believe it is, to some extent, a store of value.” To some extent, it is similar to gold. Who founded the hedge fund Appaloosa Management in 1993 and has since become one of Wall Street’s most closely watched investors.
Another prominent investor, Paul Tudor Jones, said on Wednesday that bitcoin is his preferred inflation hedge. “Clearly, it’s winning the race against gold right now.”
Bitcoin’s rise to new highs this week coincided with the launch of the first bitcoin futures ETF in the United States, a significant development that sparked excitement in the crypto community. Its previous all-time high was set in April, coinciding with another milestone for digital assets, the Nasdaq debut of crypto exchange Coinbase.
Following that previous peak near $65,000, bitcoin was in the doldrums for a few months, falling below $30,000 per token on multiple occasions. The most recent instance occurred in late July, but bitcoin has since recovered.
Tepper also commented on the stock market on Friday, saying that he does not believe it is a “great investment” right now. Uncertainty about inflationary pressures and interest rates, he says, is muddying the picture.
I’m not a fan of stocks. Bonds do not appeal to me. “I’m not a fan of junk bonds,” Tepper admitted. “Right now, stocks could be as good as anything.” “But that doesn’t mean they’re bad,” he adds. “I’m still in possession of them.”