Mizuho says SEC approval of the spot bitcoin exchanged traded fund is not good news for Coinbase. Potential upside to the company’s revenue from bitcoin ETFs may be more muted than thought, with just 1%-2% benefit from custody fees and 5%-10% total benefit if the ETFs drive additional spot bitcoin trading, the analyst tells investors in a research note. Plus, deeper cannibalization of high-margin spot bitcoin trading and/or share loss to brokers offering ETF could offset future benefits, says the firm. It expects Coinbase’s fundamentals “to serve as a painful reality check in coming quarters” and reiterates an Underperform rating on the name with a $54 price target. The stock in premarket trading is up 5% to $159.50.
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