John Todaro, vice president of crypto asset and blockchain research at Needham & Co., initiated coverage of Nasdaq-listed Coinbase (COIN) with a “Buy” rating, setting a $420 price target.

• Coinbase is a market-leading crypto exchange with “significant future opportunities beyond exchange service, which include staking, custody, yield bearing products, and more,” Todaro wrote in a note.
• The research firm projects a 467% increase in 2021 revenue and a 9% increase in 2022.
• “We view COIN as the leading, fiat-crypto on-ramp, and expect the company's exchange business to grow rapidly and sustainably as new investors adopt its crypto assets and services,” Todaro wrote. “COIN ranks as the largest crypto exchange by trading volume.”
• Coinbase's opportunities in staking, custody and interest-bearing accounts will accelerate its position as a one-stop shop for crypto financial services, according to the analyst.
• Investor concerns over fees are misplaced, according to the note. The non-commoditized nature of crypto exchanges differentiates them from traditional brokerage firms, where fee compression has occurred in recent years.
• Coinbase’s shares started trading on the Nasdaq in a direct listing in April.
• The stock closed at $257.32 on Monday.

Read more: Coinbase Rated ‘Overweight’ in Initial Coverage by Piper Sandler: Report