ETFdb Logo
  • ETF Database
  • Channels
    • Themes
      • Active ETF
      • Alternatives Channel
      • Artificial Intelligence
      • China Insights
      • Climate Insights
      • Core Strategies
      • Crypto
      • Disruptive Technology
      • Energy Infrastructure
      • ETF Building Blocks
      • ETF Education
      • ETF Investing
      • ETF Strategist
      • Faith-Based Investing
      • Financial Literacy
      • Fixed Income
      • Free Cash Flow
      • Innovative ETFs
      • Invest Beyond Cash
      • Leveraged & Inverse
      • Modern Alpha
      • Portfolio Strategies
      • Tax Efficient Income
    • Asset Class
      • Equity
        • U.S. Equity
        • Int'l Developed
        • Emerging Market Equities
      • Alternatives
        • Gold/Silver/Critical Materials
        • Crypytocurrency
        • Currency
        • Volatility
      • Fixed Income
        • Investment Grade Corporates
        • US Treasuries & TIPS
        • High Yield Corporates
        • Int'l Fixed Income
    • ETF Ecosystem
    • ETFs in Canada
    • Market Outlook
  • Tools
    • ETF Screener
    • ETF Country Exposure Tool
    • ETF Database Categories
    • Indexes
    • Scenario Analysis
    • Watchlists
    • Head-To-Head ETF Comparison Tool
    • Mutual Fund To ETF Converter
    • ETF Stock Exposure Tool
    • ETF Issuer Fund Flows
  • Research
    • ETF Education
    • Equity Investing
    • Dividend ETFs
    • Leveraged ETFs
    • Inverse ETFs
    • Index Education
    • Index Insights
    • Top ETF Sectors
    • Top ETF Issuers
    • Top ETF Industries
  • Webcasts
  • Themes
    • AI ETFs
    • Blockchain ETFs
    • See all Thematic Investing ETF themes
    • ESG Investing
    • Marijuana ETFs
  • Multimedia
    • ETF 360 Video Series
    • ETF of the Week Podcast
    • Gaining Perspective Podcast
    • ETF Prime Podcast
    • Video
  • Company
    • About VettaFi
    • Get VettaFi’ed
  • PRO
    • Pro Content
    • Pro Tools
    • Advanced
    • FAQ
    • Pricing
    • Free Sign Up
    • Login
  1. Crypto Channel
  2. There’s Still a Case for DAPP Despite FTX Fallout
Crypto Channel
Share

There’s Still a Case for DAPP Despite FTX Fallout

Tom LydonNov 23, 2022
2022-11-23

The fallout from the collapse of crypto broker FTX, including trading gone awry at research arm Alameda Research, isn’t fully known at this point, and it feels like with each passing day, another firm admits vulnerabilities to the contagion. What is clear is that at the moment, “contagion” is an accurate word because the demise of privately held FTX is punishing an array of crypto-correlated and fintech equities, including member firms in exchange traded funds such as the VanEck Digital Transformation ETF (DAPP B-).

A prime example of a crypto-correlated stock that’s now being jaundiced by the FTX brush is Coinbase (NASDAQ:COIN). To some extent, that makes sense because Coinbase was a direct rival to FTX, but that doesn’t mean the DAPP holding was exposed to FTX’s malfeasance.

“Coinbase has little direct exposure to FTX ($15m in crypto assets on the FTX platform), but we believe the number of negative near-term catalysts for the space outweigh the positives,” Needham analyst John Todaro said in a note on Tuesday. “We believe the next several weeks will be a critical time for the space as OTC firms, crypto lenders, funds, conglomerates, and BTC miners come under heightened pressure given their exposure to FTX.”

Coinbase is DAPP’s second-largest holding at a weight of 8.34%, as of November 21, according to issuer data. Indeed, Coinbase stock is under pressure, but if that pressure is mostly the result of the FTX collapse, it may be misplaced.

In fact, a case can be made that if the market moves past the view that Coinbase is imperiled, the exchange operator could benefit from increasing volume in what’s proving to be a volatile climate for digital assets.

“Coinbase could even see an uptick in transaction revenue in the current quarter – there will be higher volatility and trading volume in the near term as investors assess how far and wide the damages reach,” reported Tanaya Macheel for CNBC.

The FTX implosion is exposing the importance of trust and reliability in the crypto space. Though not perfect, Coinbase is seen as trustworthy against the backdrop of FTX’s dubious business practices, and that means something.

“We also expect Coinbase will engage in more aggressive cost rationalization, and with the expected increase in interest income over the next year coupled with cost cuts, we think insolvency fears (as are currently reflected in bond prices) are overblown,” said Barclays analyst Benjamin Budish in a report.

For more news, information, and analysis, visit the Crypto Channel.

Loading Articles...
Our Sites
  • VettaFi
  • Advisor Perspectives
  • ETF Trends
Tools
  • ETF Screener
  • Mutual Fund to ETF Converter
  • Head-To-Head ETF Comparison
  • ETF Country Exposure Tool
  • ETF Stock Exposure Tool
  • ETF Database Pro
More Tools
  • Financial Advisor & RIA Center
Explore ETFs
  • ETF News
  • ETF Category Reports
  • Premium Articles
  • Alphabetical Listing of ETFs
  • Browse ETFs by ETF Database Category
  • Browse ETFs by Index
  • Browse ETFs by Issuer
  • Compare ETFs
Information
  • Contact Us
  • Terms of Use and Privacy Policy
  • © 2025 VettaFi LLC. All rights reserved.

Advertisement

Is Your Portfolio Positioned With Enough Global Exposure?

ETF Education Channel

How to Allocate Commodities in Portfolios

Tom LydonApr 26, 2022
2022-04-26

A long-running debate in asset allocation circles is how much of a portfolio an investor should...

Core Strategies Channel

Why ETFs Experience Limit Up/Down Protections

Karrie GordonMay 13, 2022
2022-05-13

In a digital age where information moves in milliseconds and millions of participants can transact...

}
X