.SPGlobal said in a note that the outlook for Coinbase was 'negative,' and lowered the crypto exchange's long-term issuer credit rating and senior unsecured debt ratings to BB from BB+. JPRubin23 reports
In an already difficult week, Coinbase suffered another knock as the credit ratings agency S&P Global said in a note Thursday that the outlook for the crypto exchange giant was"negative."
S&P Global ratcheted down Coinbase's long-term issuer credit rating and senior unsecured debt ratings to BB from BB+, citing"weak earnings and competitive pressure." "Competitive risk has intensified in the crypto exchange sector, with the company's market share decreasing this year," S&P Global wrote."We believe that as a result of market share erosion and a higher risk of margin compression, cyclical variations for Coinbase have exceeded our previous expectations, leading us to revise our assessment of financial risk."
The credit agency said its assessment also reflected"uncertainties about the length of the current crypto bear market and"the potential for further market share deterioration." Coinbase shares closed Thursday at $84 per share, down more than 10%. Its shares reached a high of over $350 last fall.a nearly 30% decline in trading volume from $309 million in the first three months of 2022 to $217 million in its second quarter, and missed consensus revenue expectations. The exchange posted a net loss of $1.1 billion during the quarter, versus a $430 million loss in the first quarter.that it is under investigation by U.S.
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