Bottoming Out or Bouncing Back? Analyst Revises Coinbase Estimates Amid USDC Woes

Needham analyst John Todaro maintains Coinbase Global Inc COIN with a Buy and lowers the price target from $73 to $70.
Todaro lowered his Q1 FY23 volume estimate from $151 billion to $147 billion in a Monday note titled "COIN Q1 '23 Preview: Modestly Lowering Volume & Q2 Interest Income from USDC."
The analyst modestly raised his Q1 FY23 interest income estimate but lowered his interest income estimate for Q2 FY23 to reflect a 23% lower USD Coin Price (USDC) market cap.
Due to Silicon Valley Bank's failure in late March, USDC's market cap declined 23% and is yet to recover.
The analyst lowered his price target to reflect lower volume and interest income estimates for FY23.
He estimates Q1 FY23 volume to remain nearly flat Q/Q. The analyst foresees Q1 to mark the first quarter since the crypto boom unwound that Coinbase's quarterly volume did not decline, offering optimism that retail volume could have bottomed.
Additionally, alt-coin trading as a percent of total trading volume on Coinbase has increased, indicating increased retail risk-taking in crypto.
Price Action: COIN shares traded lower by 6.99% at $50.03 on the last check Monday.

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