Be Careful With All That Coinbase Crypto Hype

“Caught you lookin’ for the same thing
It’s a new thing, check out this I bring” — Don’t Believe The Hype, Public Enemy

Feet to fire, I’d guess that Coinbase will probably more double the $250 “reference price” the Nasdaq is marking it at right now and then COIN will slowly come down over the next few weeks to a more “reasonable” valuation. The fact is that I’ve been using personally and have been recommending Coinbase as one of the safest places to buy and hold cryptocurrency since 2013.

Long-time Trading With Cody subscribers will remember that I personally lost several bitcoins back when MtGox was hacked but I still have the bitcoins I own in my Coinbase accounts that I have had for just as long.  Thank you Coinbase for being safe (thus far).

Things that can make the world’s largest crypto stock sell right into a bubble when it comes public:

• A direct listing so there’s no hedge funds flipping the stock they got allocated before it starts trading? Check.
• Bitcoin and Ethereum, the two largest cryptos, spike to new all-time highs the day before and the day of the listing? Check.
• Too many people looking for decent crypt stocks can only find like a handful of them and only then if you include SQ and PYPL and TSLA? Check.
• The government has sent and is sending trillions of dollars to millions of newbie retail investors? Check.
• Every financial media outlet is seeing traffic spike whenever they talk about Coinbase creating a self-fulfilling hype cycle? (I don’t see how this event is magical other than for the people who invested or started Coinbase years ago.) Check.
• The ongoing Blow-Off Top Phase of the Bubble-Blowing Bull Market that we’ve been writing and riding for ten plus years ending? (I’d call it SPAChaustion. The markets are experiencing SPAChaustion, as there’s just too much supply. It’s not secret that as long as there’s demand, Wall Street will bring more supply until supply eventually overruns demand. We might be here.) Check.
• I love Coinbase and want to own it someday. But probably not today. And I continue to warn people against buying the crappy crypto stocks like RIOT, MARA and plenty others.

Stick with bitcoin and ethereum as your long term ways to invest in cryptocurrencies. And I wouldn’t want to be plowing into them today either, really.

Be careful out there.

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