Catenaa, Monday, January 12, 2025- Bank of America upgraded Coinbase Global shares to a buy rating last Thursday, saying a steep pullback has masked product momentum and long-term growth prospects as crypto adoption continues to expand.

The bank set a $340 price target on Coinbase stock, implying about 38% upside from recent levels near $245. Shares are down about 40% from July highs around $420, despite faster product launches and broader market expansion.

Bank of America said selling pressure tied to tax-loss activity late last year appears to be easing.

Analysts said the stock now trades at more attractive levels following the decline. Short interest has roughly doubled from a year earlier, a setup that could lift shares if sentiment improves.

The bank pointed to derivatives, stablecoins and institutional infrastructure as areas that could offset swings in retail trading volumes.

The upgrade reflects Bank of America’s view that digital asset adoption remains at an early stage, positioning Coinbase as a long-term beneficiary as crypto moves further into mainstream finance.

Analysts cited the company’s December product showcase, which outlined plans to add stock and ETF trading, expand prediction markets and roll out equity-linked perpetual products outside the US.

Bank of America also highlighted Coinbase’s Base network as a core part of its longer-term strategy.

The firm said revenue tied to Base could grow as onchain activity increases. Coinbase’s Tokenize platform was also cited as a potential gain if asset managers move real-world assets onto blockchains.

The upgrade adds to growing bullish coverage.

Goldman Sachs and William Blair recently reiterated positive views, while flagging competition and execution risks.