Jim Chanos, founder of Kynikos Associates, told CNBC that he is shorting cryptocurrency exchange Coinbase, calling it a bubble stock. Chanos expects fees to compress as competition among cryptocurrency exchanges intensifies, and doesn’t think Coinbase will be profitable this year.
“We basically think Coinbase is over-earning, and their revenue base is roughly 3% to 4% of their client assets,” Chanos said. The CNBC report did not mention the size of Chanos’ short position. Coinbase shares were down about 1.8% in after-hours trading on Friday and have fallen 26% this year.
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