Nasdaq-listed cryptocurrency exchange shared shares (coin) The 10-fold study led by Markus Thielen is rapidly approaching an overestimated threshold, it said Friday. Thielen suggests a transaction that includes short positions in coins and simultaneously long-term positions in Bitcoin
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Thielen explained in a note sent to clients that the fundamentals of Coinbase (mainly trading volume) did not keep up with the pace of stock price rally, which quickly hit an overvaluation threshold, a classic setting for a “tactical reversal.”
“While Coinbase does not completely violate the high price threshold of +30%, its imminent momentum is fast, and despite being one of the few high-quality cryptocurrency dramas listed, its current premiums indicate a risk for underperforming future,” Thielen detailed. “Traders looking to take advantage of this misalignment may consider long-term bitcoin when they are short fences, or use the option by selling coin phones and buying BTC calls to express the same view that there is a defined risk.” ”
Basic disconnection
According to a 10x linear regression model, the price and trading volume of Bitcoin can explain 75% of Coinbase’s stock price action. This means that 25% of Coin’s price action is caused by other factors, such as Circle’s IPO or potential impacts of US crypto and macro development.
From a quantitative perspective, this suggests that the price of coins tends to rise $20 in BTC for every $10,000, while trading volumes increase by $100 billion.
Recent price action shows that the rally overscales relative to the price and transaction volume of Bitcoin. Coinbase’s share price has soared 84% over the past two months, while Bitcoin has only increased by 14%.
“This advanced not only correlates with basic crypto trading volumes relative to Bitcoin’s current price, but hovered by about $100.8 billion,” Thielen said. “This rare bias suggests that Coinbase’s valuation has expanded and is vulnerable to meaning return.”
Other factors — Circle’s IPO on June 3, “genius” Stablecoin Bill on June 17 and Frenzy purchases from South Korean investors — appear to have been priced.
“As this momentum cools down, it’s clear in the recent reversals of Circle, Kakaopay and Metaplanet, the risk of Coinbase share also likely to be close to the local top,” Thielen said.
