Analyst downgrades price target of a compliant platform to $230 ahead of product launch event

Source: Yellow Original Title: Compass Point Lowers Coinbase Price Target to $230 Ahead of Product Launch

Original Link: https://yellow.com/es/news/compass-point-reduce-el-precio-objetivo-de-coinbase-a-230-antes-de-la-presentación-de-productos

Analyst Lowers Price Target on a Compliance Platform

Compass Point has lowered the price target on a compliance platform from $266 to $230, maintaining a “Sell” rating.

This move comes ahead of the cryptocurrency exchange’s product launch event scheduled for Wednesday.

Analysts highlighted tokenized stocks and prediction markets as two areas that could help the compliance platform achieve revenue diversification.

However, they expressed skepticism about whether these new business lines can offset the profit sensitivity caused by cryptocurrency price volatility.

The compliance platform’s stock fell over 5% on Monday, closing at $252.

What happened

Compass Point estimates that the compliance platform could generate $230 million in revenue from tokenized stocks and $210 million from prediction markets.

In a report released on Monday, analysts noted that it could take several years to realize these revenues.

“We believe these new business lines will not compensate for COIN’s profits, which are sensitive to cryptocurrency price fluctuations,” the analysts stated.

“We believe investors are already paying a premium for new features that may not generate significant returns in the short term.”

Investment banks expect the compliance platform to launch multiple products during Wednesday’s event.

Analysts anticipate that the exchange will offer tokenized securities to U.S. clients from the outset.

The stock tokens of a leading exchange are initially being launched to European users.

According to analysts, the compliance platform’s stock products may adopt an economic model similar to order flow payment models.

This means the exchange will not charge commissions but will receive rebates from market makers.

The compliance platform’s stock has increased only 1.7% so far this year.

This is far below the 215% increase of a leading exchange during the same period, which is currently trading at $118.

Why It Matters

As the analysts’ report was published, the compliance platform is trying to reduce its reliance on trading commissions from cryptocurrencies.

Screenshots shared on X indicate that prediction market products of the compliance platform may be driven by Kalshi.

Last month, Kalshi turned to the compliance platform’s custodial services to protect users’ USDC.

Analysts estimate that the compliance platform will derive most of its revenue from prediction markets by charging $0.01 per trade contract.

This strategy is similar to that of a major exchange and WeBull.

The move could also generate $10 million in stablecoin revenue by increasing USDC balances on the platform.

The compliance platform earns 99% of its revenue from assets supporting $78 billion USDC when these assets are held on its platform.

Last week, the compliance platform, a leading exchange, and Kalshi formed a prediction market alliance.

The organization aims to establish clear regulatory standards for the industry.

“Unless COIN stock trading offers benefits similar to traditional electronic brokers, we find it hard to see users shifting their trading to existing platforms,” the analysts added.

They noted that their revenue estimates are based on “relatively optimistic penetration rates.”

The event titled “Compliance Platform System Update 2025” is scheduled for December 17, starting at 2:00 PM Pacific Time.