This crypto stock got huge approval

This crypto stock got huge approval

Not surprisingly, 2022 will be a volatile year for both the capital markets and cryptocurrency. The days of meme stocks and lunar origins seem a long time ago. Since its debut in April 2021, Queen Piece (Currency -4.56%) It was one of the most scrutinized stocks in Nasdaq. It has become difficult to keep pace with the company’s developments amid mounting regulatory concerns about the crypto markets and waning investor enthusiasm.

However, despite all this turmoil, Coinbase has managed to make some significant progress. In this article, we will discuss how Coinbase has begun to lay the foundation for becoming a mature, full-spectrum crypto conglomerate that goes beyond just an exchange.

Big tech follows Wall Street

Over the summer, Coinbase announced that it had partnered with an asset management company Black stone. More specifically, the partnership revolves around BlackRock’s proprietary risk management software called Aladdin. At a high level, Aladdin is leveraged by hedge funds and other financial institutions to process analyzes across stocks, bonds, and foreign exchange currencies as well as derivatives and alternative assets. While this is a great list of asset classes, do you see anything missing? Coinbase did.

According to a press release on the Coinbase blog, BlackRock has chosen the exchange as its integration unit to provide “cryptocurrency trading, custodian, brokerage, and reporting capabilities to Aladdin’s institutional client base who are also Coinbase customers.”

While this partnership is nascent, it is no surprise that other large companies, albeit in different industries, are taking notice. Just last week, the internet giant the alphabet About a strategic partnership with Coinbase. Let’s explore why this is a huge step forward for Coinbase and the crypto economy.

Image source: Getty Images.

Is this partnership a big deal?

There are a lot of moving pieces in Alphabet’s deal with Coinbase, and both companies are well positioned to capitalize on it.

Essentially, Alphabet has decided that it will allow its cloud customers to pay for its services in BitcoinAnd the etheror Dogecoin They must choose. Coinbase will be the technology that supports these payments with the Coinbase Commerce offering. This is an interesting site for Coinbase because as the Alphabet cloud platform continues to grow, there is an argument to be made that Coinbase’s infrastructure will power more transactions. The two biggest variables under consideration are the pace at which crypto payments adoption is moving, and the growing number of tokens powered by Google Cloud.

While this is exciting for Coinbase, it is also a huge win for Alphabet. While Amazon and Microsoft dominate cloud computing, the Alphabet platform, Google Cloud, is rapidly gaining market share. As per the terms of the partnership, Coinbase has chosen Google Cloud as a strategic cloud provider to build advanced data and exchange services. In addition, Coinbase will use Google Cloud’s powerful computing platform to process blockchain data at scale, and enhance global access to crypto services by leveraging the optical fiber network. Featured by Google.

According to CNBC, Coinbase will move some of its existing apps far From Amazon’s cloud platform, AWS. This is a huge deal for Alphabet. Although it is still early days, Coinbase management has not let the crypto winter deter their view. Despite rising asset prices and declining trading volumes, Coinbase’s leadership has focused relentlessly on the broader adoption of cryptocurrencies, especially with large institutions.

Watch the rating

Owen Lau is an equity research analyst at Oppenheimer. It currently has a buy rating on the stock and an expected price target of $107. During a recent interview, he was asked about the implications of this partnership and what it might mean for Coinbase.

Interestingly, although not surprisingly, Lau did not explicitly say whether this transaction will affect Coinbase stock in the short term. Instead, his reasoning is that since the markets are still operating in the crypto winter, it is best that investors act with caution.

Coinbase is scheduled to release its third-quarter 2022 earnings on November 3. While there may be some volatility in the near term leading to earnings, cautious investors should wait until after the earnings release to make a decision on the stock. While Coinbase is trading well on its highs, it is still a highly speculative stock. Investors are very likely to learn more about the company’s progress with BlackRock, Alphabet, and any other potential partnerships during the call.

One thing that is very likely is that the cryptocurrency is here to stay one way or the other. Its role in the larger economy and financial markets is sure to evolve. However, investors should feel encouraged that the world’s largest financial and technology companies are not only involved in cryptocurrencies but also specifically with Coinbase. Coinbase can be a good stock to hold for investors with a long-term market outlook.

Susan Fry, CEO of Alphabet, is on the board of The Motley Fool. John Mackie, CEO of Whole Foods Market, an Amazon company, is a member of The Motley Fool’s Board of Directors. Adam Spatko He has positions in Alphabet (A stock), Amazon, and Coinbase Global, Inc. and Microsoft. Motley Fool has positions in Alphabet (A shares), Alphabet (C), Amazon, Bitcoin, Coinbase Global, Inc. , Ethereum, and Microsoft. Motley Fool has a disclosure policy.

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