Just as U.S. markets were opening Thursday, things were already looking rosy for Coinbase in early morning trading.

At the time of writing, the stock is up 5% to $168.19 after having closed at $160.38 yesterday, according to Yahoo Finance. COIN, which trades on the Nasdaq, has gained 21% since last week.

It's usually been the case that crypto stocks—meaning publicly traded companies directly or indirectly linked to the industry—perform well when the market makes big moves. That's been the case this time around with Coinbase rising with Bitcoin, which has jumped 17% since last week and is currently being traded at $52,171.71, according to CoinGecko data.

After markets close in the U.S. today, Coinbase will report its 2023 Q4 earnings.


Although last year's fourth quarter did not include the approval and start of trading for 10 spot Bitcoin ETFs, analysts are still hoping that the San Francisco-based crypto exchange's executives will be forthcoming about how the company has fared now that the funds have been trading for a week.

That's because Coinbase is the custodian for several of the Bitcoin ETFs, including BlackRock's wildly popular iShares Bitcoin Trust (IBIT), which has accumulated $5.7 billion worth of BTC since it began trading on January 11. Coinbase Custody charges an 0.2% custody fee for its ETF clients.

Windfall, right? Well, not necessarily. Don't forget that there was a pretty heated fee war right before the Securities and Exchange Commission announced its approval.

Several funds—including BlackRock—have been offering fee reductions or waivers to drive adoption. If the issuer isn't collecting fees yet, then odds are Coinbase will see a reduction until the funds cross the magical line that turns the fee faucet back on.


For IBIT, the fund has only recently crossed $5 billion assets under management mark that hikes up the fund's fees from 0.125% to 0.25%.

Sandeep Rao, a senior researcher at Leverage Shares, said Coinbase will likely benefit most from its custodian role when trading volume for Bitcoin ETF shares is high. When it drops off—either because the hype dies down or other issuers enter the market—then Coinbase will see the flow of fees shrink.

"With increased competition for trade volume with Bitcoin ETPs, Coinbase will need to put in a lot of effort to maintain its position as the dominant venue for all things crypto," he said in an email.

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