Coinbase Stock Is Down 70% This Year. Is It Time To Buy?

Coinbase Stock Is Down 70% This Year. Is It Time To Buy?

CHINA - 2022/05/25: In this photo illustration, a Coinbase logo is displayed on the screen of a ... [+] mobile phone. (Photo Illustration by Sheldon Cooper/SOPA Images/LightRocket via Getty Images)

SOPA Images/LightRocket via Getty Images

Coinbase stock (NASDAQ



NDAQ

: COIN) has declined by almost 70% year to date in 2022 and remains down by almost 80% from all-time highs seen in November 2021, trading at levels of around $75 per share. There are a couple of factors driving the sell-off. Firstly, investors have been reducing their allocation to growth stocks and futuristic names this year, with the U.S. Federal Reserve turning increasingly hawkish, amid rising inflation. Moreover, cryptocurrency prices have also seen a sharp decline, with bellwether crypto bitcoin down almost 35% year-to-date and by over 55% from its 2021 highs. Lower cryptocurrency prices typically translate into lower transaction volumes and impact active user numbers for exchanges such as Coinbase. Coinbase’s results over Q1 2022 were also weaker than anticipated, with revenue declining by 27% from a year ago. The company’s retail monthly transacting users declined 20% versus last year to 9.2 million, and total trading volume also