Citi’s bullish Coinbase target: ‘Buy crypto’s general store’

Financial services multinational Citi initiated coverage of U.S. crypto exchange Coinbase’s stock this week with a very bullish price target.

Citi analyst Peter Christiansen told investors that they could “buy crypto’s general store,” in a research note published on Tuesday, Oct. 26. Citi has given COIN a bullish price target of $415 which is substantially higher than Monday’s closing price of $319.

The analyst stated that the stock offers investors “direct exposure to increased retail and institutional adoption of cryptocurrencies.”

The multinational banking giant sees the potential in Coinbase as the company makes continued efforts to expand its operations beyond just a crypto exchange and into other areas such as NFTs and cold wallet storage.

The company accrued more than a million applications for its NFT platform waiting list within a day or so of its announcement on Oct. 13. Christiansen recommended the company, “for its position within the crypto value chain, a ‘networking-based’ business model and strategy, the undeniably very large opportunity set … yes, we believe COIN is investable.”

He also considers Coinbase’s “lean forward approach to regulatory compliance” a competitive advantage.

“To a degree, we think rising regulations could be a positive for Coinbase’s competitive positioning, particularly versus business models that predominantly rely on markets being unregulated.”

Christiansen added that the stock is in place to make “higher highs and higher lows” as crypto asset adoption increases. U.S. investment bank Piper Sandler also raised their target price for the stock to $360.

Not every analyst is on board with JPMorgan’s Kenneth Worthington raising his price target on COIN only slightly to $375 from $372. However Lisa Ellis, senior Equity Analyst at MoffettNathanson said COIN was a “must-own stock” that could go to $600 in light of its recent partnership with Facebook on its Novi crypto wallet.

Coinbase went public in April with an opening IPO price of $381, it surged to a peak of $430 on the day before retreating. COIN hit a monthly high of $326 on Monday this week but has fallen 4.3% since to an after-hours trading price of $312 according to MarketWatch.

Related: Reports suggest that a mainstream tech giant holds shares of Coinbase stock

Shortly after it was listed, reports emerged that Coinbase insiders and executives had begun dumping the stock. The company made around $1.6 billion in profit in Q2, a large portion of that coming from its higher than industry average transaction fees. The Q3 report comes out on November 9.

In August, CNBC ‘Mad Money’ host Jim Cramer recommended Coinbase stock suggesting investors allocate 5% of their portfolios to crypto assets.


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Citi Targets $415 for “Crypto’s General Store” Coinbase

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Analysts at the U.S. investment bank described Coinbase as “crypto’s general store.”

Citi Recommends Coinbase Stock

Citi sees upside in Coinbase stock. 

Analysts at the U.S. bank issued a $415 price target for COIN in a report published Tuesday, describing Coinbase as “crypto’s general store.” 

The report added that Coinbase “offers investors direct exposure to increased retail and institutional adoption” of digital assets that offers an “undeniably very large opportunity set” within the cryptocurrency ecosystem. 

Citi also said that the exchange’s “lean forward approach to regulatory compliance” could give it an edge over its competitors in the future. “To a degree, we think rising regulations could be a positive for Coinbase’s competitive positioning, particularly versus business models that predominantly rely on markets being unregulated,” the note read. 

Coinbase is currently the world’s second-largest centralized cryptocurrency exchange. Its biggest rival, Binance, trades about five times more volume today, but it’s also faced intense scrutiny from regulators around the world over the last few months. Coinbase, meanwhile, has been proactive in engaging with regulators, recently pushing for a unified framework for regulating cryptocurrencies in the U.S. 

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The U.S. exchange went public on Nasdaq in April in what was described as a watershed moment for the cryptocurrency industry, hitting a valuation of $100 billion on market opening. Its recent ventures include a partnership with the NBA and forthcoming NFT marketplace. 

COIN closed at $325.54 Monday, which means Citi is forecasting a 27% price rise. 

The report also said that blockchain and the crypto markets present “an exceptionally large opportunity,” adding that it believes the technology is “here to stay.” 

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Citi Bank Launches “Digital Asset Group” for Developing Crypto Products

Citi group officially announced a “Digital Asset Group” launch in its wealth management department on Thursday.

This new division will be led by Alex Kriete and Greg Girasole of the Citi Global Wealth Investment (CGWI) division. The establishment of the Digital Assets Group will make Citi the latest bank to set foot in the field of encrypted wealth management.

According to the memorandum signed by Iain Armitage, head of Citi’s global capital markets, and global head of Citi’s investment management Rob JasminskiKriete and Girasole‘s promotion will be responsible for leading the new department to provide digital assets such as cryptocurrencies, non-fungible tokens (NFT), stablecoins and central bank digital currencies (CBDC) the best market-leading partner for various assets.

Citigroup wrote in a signed memorandum:

“Given the exciting new developments we are seeing around cryptocurrencies, tokenization, and other advances powered by blockchain technology, we are pleased to announce the formation of the Digital Assets Group.”

The group said it would commit to the development of cryptocurrency and blockchain fields. In addition to Citibank, other well-known financial institutions, such as  Morgan Stanley and Goldman Sachs, have also launched their internal plans to scrambling for a piece of the action in the cryptocurrency market for their wealthy wealth management clients.

Earlier in May, Citi Group is planning to enter the crypto space. The multinational investment bank appears to be in the early stages as it has not decided on specific crypto services it would offer.

However, the bank is engaging in discussions regarding the roll-out of trading, financing, and custody of all crypto services.

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Citigroup the Latest Wall Street Giant to Launch Digital Assets, Blockchain-Focused Business Unit

Citigroup is poised to enter the volatile crypto waters.

Citigroup Launches Crypto Dedicated Business Unit

According to a memo obtained by The Block, Wall Street behemoth Citigroup has officially launched a new business offshoot focused on the cryptocurrency and blockchain space.

The banking giant announced today the launch of Digital Assets Group, a new group that will be a part of Citigroup’s wealth management division called Citi Global Wealth Investments, the memo says.

The memo reads in part:

“Given the exciting new developments we are seeing around cryptocurrencies, tokenization, and other advances powered by blockchain technology, we are pleased to announce the formation of the Digital Assets Group.”

The memo adds the newly unveiled digital assets unit will be led by Alex Kriete and Greg Girasole. With this development, Citi has become the latest major financial institution to join the crypto bandwagon.

Wall Street Steadily Warming Up to Crypto

With Citigroup’s entry into the crypto landscape, the industry continues to get increasingly congested with large financial institutions keen on offering digital assets services to their clients.

As previously reported by BTCManager, filings with the SEC indicated that U.S.-based multinational investment corporation BlackRock held a considerable amount of bitcoin (BTC) futures during early 2021.

Similarly, in March this year, Morgan Stanley announced in a report that digital currencies are getting mighty closer to establishing themselves as an investible asset class.

The report read in part:

“For speculative investment opportunities to rise to the level of an investable asset class that can play a role in diversified investment portfolios requires transformational progress on both the supply and demand sides.”

On a similar note, BTCManager reported in April that New York-based JPMorgan Chase & Co. revealed it would soon offer an actively managed bitcoin fund to private wealth clients. This U-turn by the banking giant came four years after its CEO dubbed bitcoin “a dangerous fraud.”

On a recent note, BTCManager reported on June 19 that Goldman Sachs had joined forces with Mike Novogratz’s Galaxy Digital to offer bitcoin investments services to its accredited clients.

At press time, bitcoin is exchanging hands at $34,468, according to data from CoinGecko.

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Banks cautious about crypto ahead of COVID-19 testimony before US Senate

Major Wall Street bank executives will appear before the United States Senate Banking Committee on Wednesday to discuss the role of their financial institutions in the recovery of the American economy.

Democratic lawmakers plan to grill a number of major bank execs, whose firms saw record profits during the COVID-19 pandemic while average Americans struggled to make ends meet. 

In prepared testimonies posted on Tuesday, CEOs at the Bank of America, Citigroup and Wells Fargo described their respective banks’ responses to major challenges such as inequality, diversity, climate change, taxes, as well as how their banks handle cryptocurrencies. 

This year saw a record bull run in cryptocurrency markets as major financial institutions opened up to digital assets, adding trading desks and custody wings to handle client interests in major cryptos like Bitcoin (BTC).

In his testimony, Bank of America CEO Brian Moynihan said that the bank is continuing to evaluate the benefits, risks and client demand for crypto-related products and services. “Currently, we do not lend against cryptocurrencies and do not bank companies whose primary business is cryptocurrency or the facilitation of cryptocurrency trading and investment,” he said.

Moynihan said that BofA is also assessing new technologies like distributed ledger technology, which could potentially deliver value to the bank’s customers. However, while BofA holds over 60 blockchain patents, the bank still has “not found a use case at scale,” Moynihan said.

Similarly, Citigroup CEO Jane Fraser also outlined a measured approach to crypto, stating that the bank will need to ensure clear controls and governance before engaging with cryptocurrencies. “Citi is focusing resources and efforts to understand changes in the digital asset space and the use of distributed ledger technology, including demand and interest by our clients, regulatory developments and technology advancements,” Fraser wrote.

Wells Fargo CEO and president Charles Scharf said that the company has been closely following developments around cryptocurrencies. Digital assets “have emerged as alternative investment products though their status as a currency and mechanism of payment remains fluid,” Scharf noted. The exec also mentioned that Wells Fargo is preparing to roll out a pilot for a blockchain-based settlement service within the bank’s global branch network.

The Senate Banking and House Financial Services committees will also hear from the CEOs of JPMorgan, Goldman Sachs, and Morgan Stanley. The latter two introduced limited crypto services earlier this year, while the former is reportedly mulling opening a crypto trading desk.