Coinbase stock fell to its all-time low on Friday, two days after the cryptocurrency exchange launched its long-awaited NFT marketplace. The stock on the Nasdaq fell to $131.14 in after-hours trading, down more than 15% since the market’s beta launch.
The launch, hyped for more than a year, failed to reverse Coinbase’s months-long stock slump. The stock has lost 47.61% since January. Even in a tough year for crypto trading, 16.39% YTD losses were reduced for Bitcoin and 21.13% for Ethereum.
On Thursday, JPMorgan analyst Kenneth Worthington cut his price target for COIN by 31% to $258. Describing the call in a note to customers, he wrote: “The crypto markets need some enthusiasm in terms of new products and/or new use cases in order for the crypto markets to continue to become more mainstream. , thus driving the level of activity.”
It seems, at least for now, that Coinbase’s NFT marketplace has failed to generate much enthusiasm. The platform joins a crowded ecosystem that includes OpenSea, Rarible, Foundation, SuperRare, LookRare, and Nifty Gateway, among others. (NFTs are unique blockchain tokens that prove ownership of digital assets.)
Coinbase’s marketplace differentiates itself from competitors by emphasizing the communal experience, encouraging NFT artists and buyers to interact and engage with social features like Instagram. The platform, which collects any NFTs for sale on the Ethereum blockchain in the marketplace, still has limited-access and is slowly opening up to its millions-long waiting list. It does not yet support in-platform NFT minting or other blockchain platforms other than Ethereum, but is planning on an unspecified date.
The launch, initially planned for late 2021, also comes at a time when last year’s red-hot NFT market seems to be cooling off. But despite Coinbase’s late foray into NFTs, the exchange’s bet on community engagement also comes at a time when there has been a steady rise in NFT utility, from status symbols to community-building tools.
The best of Decrypt straight to your inbox.
Get daily, weekly roundups of top stories and deep dives straight to your inbox.
