SummaryCrypto is in a winter but will probably continue to exist. I believe Coinbase may be a good contrarian bet to gain crypto exposure for the below reasons.Successful listed exchanges such as Chicago Mercantile Exchange enjoy high profit margins and have large market caps. Coinbase has the potential to become a leading crypto trading exchange.The crypto trading industry is ripe for consolidation as revenues sag. Coinbase has staying power and the potential to be the consolidator as it is better capitalized than competitors.Crypto assets may or may not recover but based on my valuation, Coinbase’s current valuation is justified if it captures 10-20% market share and crypto trading volumes are akin to gold.Cautious investors may wait for catalysts such as actual consolidation happening before investing, given the overall market turbulence.Crypto is widely thought to be in a winter with Bitcoin (BTC-USD) falling from nearly $70K per coin to $19K since the Fed started hinting the end to easy monetary policy in November 2021.Bitcoin chart (stockcharts.com)However, crypto is probably here to stay:Given large declines in the price of Bitcoin etc. since last year, which probably halted its momentum in substituting for money, it is less of a threat to traditional monetary systems and more of a curious oddity – this might give it more breathing room from governments that jealously guard their monopoly over money printing.Hence it ap...
