Analysts are divided on Coinbase's acquisition of Deribit

BlockBeats News, May 10: Coinbase chose to disclose its acquisition of Deribit to the market before the Thursday stock market close ahead of its earnings report. Benchmark analyst Mark Palmer pointed out that with more institutions adopting cryptocurrency, acquiring Deribit would allow Coinbase to "immediately dominate in the rapidly growing derivatives space."

Oppenheimer analyst Owen Lau further believes that this move will make Coinbase a "strong challenger" to Binance, Bybit, and OKX in the derivatives field, emphasizing that "cryptocurrency options have weaker cyclicalities and stable demand regardless of market movements."

However, Compass Point analysts Ed Engel and Joe Flynn pointed out that Deribit primarily serves institutional clients, which does not help increase Coinbase's retail-focused perpetual contract trading volume. The two analysts downgraded Coinbase to sell last week, reiterating that the U.S. retail trading market for Coinbase has become saturated. Michael Klena of Architect Partners believes that this acquisition will not fundamentally change his evaluation of Coinbase (target price $170), as it is merely an extension of its existing business and cannot reduce the impact of cryptocurrency market volatility on quarterly performance.