Coinbase Stock Surges as Bitcoin Hits $80,000

Coinbase stock has surged along with Bitcoin's price climbing over $80,000 this week. Goldman Sachs raised its price target on COIN to $196 from $173.

The link between Coinbase's stock and Bitcoin's price is moderate, not tight. PortfoliosLab data show a long-run correlation of 0.61, which means the two assets tend to move together but with some independence.

Coinbase does not hold Bitcoin on its balance sheet like Strategy (MSTR) does, so its revenue comes mostly from trading fees. This means COIN tends to rise when bitcoin's price climbs and trading activity increases, and fall when volume dries up.

The performance of COIN Stock and BTC have followed a similar path YTD, but COIN's volatility has run more than double Bitcoin's over the long run at roughly 20% against 8.5%. This extra volatility cuts both ways, with COIN swinging wider in both directions when compared to Bitcoin.