Mizuho Lowers BitGo's Price Target to $11: States Delay of "Clarity Act" Expands Regulatory Advantage

August 15. In its latest research report, SMBC Nikko Securities lowered the target price of the crypto custodian company BitGo from $14 to $11 but maintained an "Outperform" rating. Analysts believe that the ongoing delay of the U.S. crypto market structure bill, the "Clarity Act," may actually benefit BitGo in solidifying its competitive advantage.

SMBC stated that the market generally views the regulatory framework delay as a negative factor for BitGo. However, the institution believes the opposite is true. As BitGo already holds the first federally chartered digital asset trust bank in the U.S. owned by a publicly traded company, its business is not dependent on the implementation of new regulations, while competitors still need to wait for regulatory clarity.

The analysts pointed out that with each quarter of delay, BitGo's existing licenses, compliance system, and regulatory first-mover advantage will further accumulate, raising the barrier to entry for new players.

In terms of performance, BitGo's revenue in the second quarter reached $4.33 billion, a year-on-year increase of 79.6%. The net loss was $19 million, significantly narrowing from the $60.7 million loss in the previous quarter. SMBC believes that the market currently values BitGo as a "struggling company," but its actual status is closer to a "high-growth, recurring revenue business."

The report stated that BitGo's customer base grew by 27% year-on-year, with subscription and service revenue increasing by 7% quarter-on-quarter. Additionally, the company's collaborations with DTCC, Canton, Figure, and other institutions are expected to make it a key infrastructure provider for tokenized securities and on-chain financial products.