Cryptocurrency exchange Coinbase will not get away from the profitability challenges it will face from the crypto market slump, in spite of having a strong brand name and trustworthiness in the crypto market, according to financial investment analysts.Credit rating company Moody’s launched a note on Coinbase on Jan. 19 discussing its downgrade of the business’s senior debt and business family ranking( CFR)– a ranking assigned to reflect the opinion of a business’s ability to honor its monetary obligations.Coinbase’s CFR and senior debt were re-graded to B2 and B1, from Ba3 and Ba2, respectively, showing the company is”non-investment grade” and “speculative and based on high credit risk “according to Moody’s. The company kept in mind that Coinbase is struggling with” considerably compromised

revenue and capital generation” due to “tough conditions, “specifically depressed crypto rates and lower trading activity.The market conditions saw Coinbase lay off 20%of its employees, around 950 people, on Jan. 10,

its second wave of recent major layoffs following its June 18%headcount slash in a quote to cut expenses. Coinbase CEO Brian Armstrong at a conference in 2018. In the most current round of layoffs, he stated the company required”the proper operational effectiveness to weather recessions in the crypto market.” Source: Flickr Nevertheless, regardless of Coinbase’s bid to preserve liquidity, Moody’s still expected”the company’s success to remain challenged.” The personal bankruptcy of its crypto exchange peer, FTX, is a cause for increased concern and uncertainty regarding crypto guideline according to Moody’s. It stated an unexpected move by regulators in the crypto market could adversely impact Coinbase’s revenue through increased costs of regulative compliance.Moody’s added, nevertheless , that increased oversight”

could eventually favor the reasonably more fully grown and compliant crypto-asset platforms such as Coinbase.”Meanwhile, a separate note from analysts at JPMorgan argued that Coinbase’s credibility and credibility in the industry have strengthened after recent collapses.”While the crypto-ecosystem has suffered additional meaningful credibility issues, Coinbase has emerged with its credibility and brand reinforced– a minimum of fairly. “The financial firm’s analysts maintained a ranking of

“neutral “for Coinbase and stated the business could even be a”recipient of the obstacles”other exchanges have actually dealt with in the wake of FTX’s collapse.The upcoming Shanghai tough fork for the Ethereum blockchain could also be a positive for the exchange, according to JPMorgan’s analysts.Related: Coinbase stops Japan operations amidst trading slump The upgrade “could introduce a brand-new era

of staking for Coinbase”with analysts approximating 95%of retail investors on the platform may stake Ethereum post-upgrade, netting Coinbase up to nearly $600 million a year.On Jan. 6, Coinbase shares

hit an all-time low of$31.95 after over a year of constant cost decreases, according to Yahoo Finance information. The day previously, experienced financier and ARK Invest CEO Cathie Wood filled up on $5.7 million worth of Coinbase shares.Since then the

share rate of Coinbase and other crypto-related business have surged.Coinbase acquired 72.6% since the Jan. 6 low and traded at over$55 at the close of market on Jan. 20, where it saw an

11.6%gain on the day.