Share values for leading cryptocurrency exchange Coinbase Global Inc. fell by 11% as trading closed on Monday, June 27th, as a crypto winter continues to grip the global financial sector.

The fall follows a recent announcement by investment bank Goldman Sachs analysts that they had downgraded the exchange to a sell rating.

Before the Goldman downgrade, Coinbase’s share values were already down by 75% due to the less than stellar performance of cryptocurrencies across the board. The change of status has sunk the exchange’s value further by 78%.

According to Goldman analyst William Nance, the ongoing downdraft in cryptocurrency prices and the general decrease of activity throughout the sector prompted the investment bank to downgrade Coinbase.

In a note shared with the media, Nance added that he and his team believe that Coinbase needs to significantly reduce its cost base to stave off further deterioration caused by severely decreased trading activity throughout the sector.

Currently, Coinbase’s overall value is down to $12.4 billion. According to current market data, the company has twenty buy ratings, six holds, and five recommendations to sell, including the recent one from Goldman Sachs. 

The company’s average analyst share price target is around $117, the lowest it has been in its trading history. Nevertheless, this is still 100% above the rate it usually trades.

Equities Darling No More

Last year, Coinbase became the darling of the equities market when it became the largest cryptocurrency exchange in the United States, its value surging over $75 billion at around the same time leading crypto Bitcoin hit record highs.

However, it has all been downhill from there. Coinbase has since been buffeted by several serious issues, such as reduced revenues and trading volumes caused mainly by some of the worst selloffs in the cryptocurrency scene in recent years.

But equity investors are just one group among the financial professionals shying away from Coinbase. As of the last week of June 2022, the company’s senior unsecured bonds – all slated to mature in 2031 – were among the biggest decliners in the US high-yield market.

The emergence of other players in the scene has also affected Coinbase’s bottom line. For example, in early June, rival Binance US announced that it plans to offer zero-fee trading for Bitcoin and other tokens.

As a result of these adverse events, Coinbase had to lay off 18% of its workforce to return its ballooning operating expenses to more manageable levels.