There is a rumor circulating that Coinbase ($COIN) might be collapsing.
Coinbase has $6 billion in cash and about $1.3 billion in crypto holdings, which might be less than $200-$300 million at the current level (depending on what they are holding) so maybe this is just a FUD. Then why would they suspend their affiliate programs? Sometimes, the ROI might not be there to continue their affiliate program but we know that their customer acquisition cost is really low sitting at $5.15. What about $248 million stablecoin outflow? Are they struggling to hold their market share? Some people think so. And how bad can it get?
We have so many questions. But the main question you should be asking is what’s going on with the company that we don’t know of that after their stock reaching $357 and heading back down to $60’s isn’t considered cheap or a buying opportunity?
My gut tells me (I don’t have any facts or data to support this) is that they might have made a major bet that went against them and they are frantically trying to reserve cash knowing something is about to happen. How do I know this? I have done significant cost cutting for companies before and after bankruptcy filings and I smell it. As a publicly traded company that’s expected to deliver both top and bottom line growth to shut their affiliate marketing program is a sign of trouble that outsiders can see.
On that note and given today’s price movement, I am taking a small short position on $COIN. For you, do your own DD before making any investment decisions.