Barclays (BCS), in a report released on Thursday, said it was revising its Coinbase estimates (COIN) ahead of earnings. The bank also downgraded the stock from equal to underweight.

The bank has raised its target price for the stock of the crypto exchange to $70, up from $61. Coinbase’s shares were trading 1.4% lower in premarket trade at $84.79 at the time of publication.

Coinbase reports earnings for the second quarter on August 8th after the close. Revenue and costs have been surprising in recent quarters. However, with USD Coin (USDC), volumes, and the USDC market cap being depressed due to a regulatory crackdown, and the recent surge in the share price the bank does not see many positive drivers in the near term.

Analysts led by Benjamin Budish wrote: “While we still believe Coinbase will be a long-term victor in the crypto ecosystem as a whole, fundamentals are challenged and recent relief due to price action, rising rates and cost rationalization may have very little more to offer.”

The report stated that June exchange volume was “modestly better” than May. However, overall second-quarter volume was materially lower than the first quarter. July metrics also tend to be declining month-on-month.

Barclays states that, while Coinbase’s shares have appreciated significantly following the news of a BlackRock sponsored spot Bitcoin (BTC) Exchange-Traded-Fund (ETF) for which Coinbase will be prime broker and custodian, “it does not believe this accurately represents the eventual P&L effect that could accrue Coinbase.”

Berenberg: The Investors’ Enthusiasm For Coinbase Shares Could Be Short-Lived

Sheldon Reback is the editor.