Citron Recommends Short Sale of Coinbase Following Site Outage; Ether Defies Previous Expectations
Summary:
Citron Research, led by Wall Street short-seller Andrew Left, has suggested a short sale of Coinbase (COIN) stocks following a temporary outage on the trading platform on February 28. Citron called for investors to buy Bitcoin through an ETF while also short selling the "inflated" Coinbase shares. The platform's issues, resolved on Feb. 29, had included zero account balance displays and transaction errors. Despite Citron's often bearish view, previous forecasts, like shorting Ether (ETH) in late 2022, did not pan out as the digital currency subsequently increased in value by 182%.
Citron, a notable investment research company founded by famed Wall Street critic Andrew Left, has recommended a short sale of Coinbase (COIN) stocks following an interim closure of the exchange on Feb. 28. Stating on Feb. 29, "The fresh mishap on the $COIN site makes the Long Bitcoin/Short Coinbase trade a highly interesting option within the cryptocurrency market," Citron called to buy Bitcoin through an ETF while selling the inflated Coinbase exchange shares.
Investors often buy one asset while selling another to create a safety net, wagering that the bought asset's perceived worth will rise, while the shorted asset's value will lower, producing a clear contrast trade. Coinbase, along with other virtual currency exchanges, faced a momentary interruption on Feb 28th when a sudden Bitcoin price crash resulted in a 10% fall in the cryptocurrency's market value, which later recuperated slightly. During this Coinbase downtime, users faced issues like zero account balance displays and transaction errors. Coinbase thanked its customers for their patience and confirmed that all account balance display issues were resolved on Feb. 29 on http://Coinbase.com.
Coinbase, post the approval of spot Bitcoin exchange-traded funds by the U.S. Securities and Exchange Commission in January, emerged as the fourth largest publicly traded asset exchange globally, boasting a market cap exceeding $50 billion. Riding on Bitcoin's revival of its $60000 benchmark, the exchange thrived as one of the custodians aiding spot Bitcoin ETF managers in swapping BTC transactions to ETF shares, all based on user demands.
However, every prediction by Citron, often known to harbor a bearish outlook, hasn't always been accurate. In a removed tweet following the breakdown of cryptocurrency exchange FTX in 2022, Citron recommended shorting of Ether (ETH), stating dubiousness about the $130 billion token's common sense flaws. Despite the sell suggestion, Ether has since provided a return of 182% and is currently valued at $3,434.
Published At
2/29/2024 8:36:43 PM
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