Shares of Coinbase Global Inc. (COIN) rallied strongly on Friday after JPMorgan Chase upgraded the cryptocurrency exchange, featuring new monetization opportunities tied to the base network and USDC payment strategy.
The bank’s analysts raised their rating to “overweight” from “neutral” and raised their price target to $404 per share, indicating about 15% upside from current levels.
JPMorgan said Coinbase is “leaning on” the base layer-2 blockchain and exploring ways to better capture value from the growth of the platform.
The bank estimated that the Launching a base token It could represent a $12 billion to $34 billion market opportunity, with retained Coinbase shares potentially worth $4 billion to $12 billion. Analysts noted that token distribution is likely to prioritize developers, validators and the grassroots community.
The report also pointed to potential margin expansion from Coinbase’s USDC changes (USDC) reward program. JPMorgan said Coinbase could reduce interest rewards for most users as they are offered primarily to coinbase a subscriber — a move that could add nearly $374 million in annual revenue at current USDC yields and interest rates.
Following the upgrade, shares of the coin climbed more than 9% on Friday to $353. The stock is now up nearly 42% year-to-date, lifting Coinbase’s market capitalization to nearly $90.6 billion.
Related: Coinbase launders $25m to survive a podcast from the last bull run
Coinbase earnings in spotlight
Coinbase is scheduled to report third-quarter results on October 30. According to the Zacks Investment Researchanalysts expected the company to post earnings of $1.06 per share, up 71% year over year, on revenue of $1.74 billion, an increase of 44.1% from the same quarter last year.
An upcoming report follows A mixed second quarter.
The company is placing growing emphasis on the subscription and services segment, which is expected to contribute $665 million to $745 million in the third quarter.
Among the main developments of the quarter, Coinbase highlighted the approval of Genius Act.
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Related: Coinbase CEO announced ‘private transactions’ are coming to the base
