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Fund Manager Jim Chanos Says He’s Shorting Coinbase

The founder of Kynikos Associates called the crypto exchange a “bubble stock” in a CNBC interview.

Updated May 11, 2023, 5:59 p.m. Published Mar 18, 2022, 11:08 p.m.

Jim Chanos told CNBC Friday he’s shorting cryptocurrency exchange Coinbase (COIN), calling it a “bubble stock.”

Chanos expects fee compression as competition increases across crypto exchanges, and doesn’t think Coinbase can be profitable this year.
“We basically think Coinbase is over earning,” Chanos said in the interview. “If you do the numbers, their revenue base is roughly 3% to 4% of their custodian assets, their customer assets.”
CNBC’s report did not mention the size of Chanos’ short position.
Wall Street has remained positive on the longer-term outlook for Coinbase, despite expectations for some near-term headwinds. Analysts expect Coinbase to diversify its revenue from different segments, including non-fungible tokens (NFT).
Coinbase shares were down about 1.8% in after-hours trading Friday, and have fallen 26% this year.

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Michael Bellusci is a former CoinDesk crypto reporter. Previously he covered stocks for Bloomberg. He has no significant crypto holdings.

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