What happened
Generally speaking, as the cryptocurrency market goes, so goes the stock price of Coinbase Global (NASDAQ: COIN). For the most part, Thursday was a good day for cryptos, so Coinbase shares got a natural lift. On top of that, a positive review of one the company's future business lines from an equity analyst gave the trading-platform operator an additional shot of bullishness.
So what
This morning, Needham & Company prognosticator John Todaro gave kudos to Coinbase's efforts in the non-fungible token (NFT) sphere -- or at least, its path toward becoming a meaningful platform for these extremely trendy blockchain-based investments. The company has been developing a virtual marketplace for NFTs and has intimated that this will launch in the very near future, although specifics have not yet been provided.
Image source: Getty Images.
Regardless, Todaro sees much potential in Coinbase brokering such products. In a new research note, he wrote that, "What we have seen so far has given us confidence in the potential product offering, and we are excited about a possible new spin on an NFT marketplace with Coinbase's social NFT aspect."
The analyst especially sees opportunity in Coinbase simply providing a stable and reliable outlet for investors to trade such instruments. "We also note that peer platforms, such as OpenSea, have received considerable negative attention from the NFT/crypto community in recent weeks from downtime/outage, phishing attacks, removing certain NFT series, etc.," the analyst added.
Now what
While Todaro's analysis is clear-eyed and accurate, crypto investors must exercise caution. Coinbase has a good reputation as a solid and dependable operator. However, this much-discussed NFT platform has yet to launch and is therefore unproven.
That goes not only for its basic operability, but also its scalability. After all, any type of exchange is only useful if it can attract a critical mass of investors trading through it.
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Eric Volkman has no position in any of the stocks mentioned. The Motley Fool owns and recommends Coinbase Global, Inc. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
