Coinbase Global ( NASDAQ: COIN ) stock fell 3.8% in Wednesday premarket trading after Bank of America analyst Jason Kupferberg downgraded the cryptocurrency exchange to Underperform from Neutral, citing waning crypto transaction volume in Q4 as the market downturn persists. The downbeat coverage followed Coinbase's ( COIN ) latest round of job cuts on Tuesday, laying off 25% of its staff as it navigates the prolonged bear market. In turn, the company indicated that its key operating metrics are expected to be in-line with its 2022 guidance and it sees operating expenses declining about 25% Q/Q in Q1. However, the trading platform's volumes for December -- the first full month after rival FTX ( FTT-USD ) imploded -- were less than half of its Q1-Q3 monthly average of around $76B, Kupferberg wrote in a note, citing CoinGecko data. While the consensus is modeling a $67B monthly run-rate for 2023, Kupferberg is forecasting just ~$49B/month, which is in-line with Coinbase's ( COIN ) average for the back half of 2022. "With heightened regulatory uncertainty and consumer confidence shaken due to FTX, we think retail crypto market participation will remain tepid in 2023 and note that COIN’s retail take-rates are ~90x that of institutional," he explained. The Underperform rating converges with the Quant system's Strong Sell rating but disagrees with the average Wall Street analyst's Hold rating. Seeking Alpha contributor CashFlow Hunter also flagged COIN as a Strong Sell, arguing the company could still be EBTDA negative based on recent revenue trends .
