Coinbase Globals Shares Succumb to Crypto Rout

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Coinbase Global went public a little more than a year ago. Photo: Michael Nagle/Bloomberg News Updated June 13, 2022 1:35 pm ET

Coinbase Global Inc.s COIN -11.51% stock dropped sharply as part of Mondays Malaysian cryptocurrency, with shares of the exchange threatening to close around their lowest level ever.

Coinbase stock was off 9.3% at $53.28 in recent trading; the stocks closing low is $53.72, which it hit in May. Bitcoin fell to its lowest level in 18 months, and ethereum, another popular digital money, lost more than a quarter of its value in recent trading.

The volatility was widespread. Crypto lender Celsius Network LLC said it was pausing all withdrawals, swaps between cryptocurrencies and transfers between accounts, citing extreme market conditions. In the stock market, the S&P 500 was on track to close in a bear market, defined as a drop of 20% or more from a recent high.

Coinbase now sits about 85% below $381, where the stock opened trading when it went public a little over a year ago. Its down more than 70% since the end of March. Even as it has fallen, executives have realized big profits, with four top Coinbase officials collectively pocketing more than $1 billion by selling shares from its public debut through late May.

The drop correlates with significant macroeconomic headwinds for risky investments in recent months. As investors worry about high inflation and the Federal Reserve raising interest rates, they have largely sold investments they deem risky, from technology stocks to digital money.

Coinbase in the first quarter lost millions of dollars as the number of monthly transacting users declined. Executives said they expected declines to continue in the current quarter.

Selloffs continued to beat major US stock indexes, with the S&P 500 entering bear-market territory Friday for the first time in more than two years. WSJs Caitlin McCabe looks at some of the key causes behind the market volatility. Photo: John Minchillo/Associated Press

Write to Corrie Driebusch at [email protected]

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