Coinbase Global (COIN) shares fell on Wednesday as the cryptocurrency exchange company felt the heat of falling bitcoin prices.
Shares of the Wilmington, Del., company on Wednesday closed down 2.5% to $311.67.
The stock move comes one day after Citi analyst Peter Christiansen initiated coverage of Coinbase with a buy rating and a $415 price target.
Piper Sandler Richard Repetto on Tuesday also boosted his price target for Coinbase, to $360 from $335.
Bitcoin was down 5.7% to $58,956 at last check, according to Coindesk, while ethereum was off 3.9%, and dogecoin was down 11%.
The only apparent bright spot in the crypto skyline was so-called meme token shiba inu, which was soaring 20%.
"Today’s sharp correction lower has caught the market on the hop and turned the recent bullish outlook lower," said Nicholas Cawley, an analyst with the news and research website DailyFx.
"After weeks of fresh highs, with alt-coins, in particular, experiencing hefty double-digit percentage gains, today’s selloff is a warning not to be complacent in this market, especially when high levels of volatility are always around the corner."
While there are no confirmed reasons so far for the move, Cawley said market sentiment may have been damaged after Robinhood released disappointing earnings.
After the bell on Tuesday Robinhood posted a wider-than-expected quarterly loss, as the company saw fewer new accounts amid a slowdown in activity related to cryptocurrencies.
“Crypto activity declined from record highs in the prior quarter, leading to considerably fewer new funded accounts,” the company said in a statement.
Repetto from Piper Sandler said in a research note the dependency on Dogecoin in the second quarter exposed short-term vulnerability. But he noted that Robinhood Chief Financial Officer Jason Warnick said "dogecoin remained one of the top coins traded at HOOD."
"Bottom line, we believe HOOD's launch of a successful crypto wallet (discussed at length on the 3Q21 earnings call) is essential to HOOD's (1) diversification of crypto revenues (as would be the launch of additional coins)." Repetto said, "and (2) crypto revenues returning anywhere near 2Q21's levels in the moderate term (unless dogecoin volumes spike again)."