Analysts Back Coinbase Stock Amid Bitcoin Rally

COIN is trading at its highest level since May as risk-on behavior returns

Coinbase Global Inc (NASDAQ:COIN) stock is buzzing to start the week, as Bitcoin (BTC) moves back toward $85,000 and several analysts have doled out bull notes on the equity this morning. Clear Street lifted its COIN price target to $224 from $204, Morgan Stanley initiated coverage with a $250 price target and "equal weight" rating, and Needham reiterated its "buy" position.

BTC is trading at its highest level since January, building on last week's post-Fed meeting surge. Crypto peers Strategy (MSTR) and Circle Internet Group (CRCL) are up 7.9% and 6.2% this morning, respectively.

On Friday, COIN gapped higher by 11.7%, after the SEC cleared a temporary path for platforms like Coinbase to trade tokenized stocks. Additionally, the Commodity Futures Trading Commission laid out crypto market rules for the White House to review. Coinbase stock is trading at its highest level since mid May, but is still 10% lower on the year.

A short squeeze could provide more momentum. Short interest increased by 25.6% in the two most recent reporting periods, and the 27.38 million shares sold short account for 12.5% of COIN's total available float. 

Options traders are getting in on the action. In just the first half hour of trading, 52,000 calls have changed hands, volume that's 1.7 times the average intraday amount and more than double the number of puts traded. The weekly 9/25 235-strike call is the most popular, with new positions being bought to open.