Coinbase sinks to the lowest level since its IPO as newly public companies struggle

• Coinbase stocks tumbled to its lowest since the company's hotly-anticipated Nasdaq direct listing on April 14.
• The stock is close to sinking below its $250 reference price.
• "Coinbase, from a stock perspective, has entered bear market correction territory," an expert said.

Coinbase shares tumbled to their lowest since the company's hotly-anticipated Nasdaq direct listing on April 14.

The stock price of the largest cryptocurrency exchange in the US slipped 8.16% to $251.85 at around 2 p.m. ET Thursday, continuing its slide for the fourth straight day. It was trading 5.50% lower to $257.98 as of 3:40 p.m. ET.

"Coinbase, from a stock perspective, has entered bear market correction territory," David Wagner, portfolio manager and analyst at Aptus Capital Advisors, told Insider.

While Coinbase's debut saw volatile trading through the day, the company had a valuation on a fully diluted basis of about $86 billion by the end of the session. The stock had a $250 per share reference price and opened at $381 before hitting an intraday high of $429.54, then reversing course to trade as low as $310.

Wagner added that from a fundamental standpoint, institutional investors may be worried to dip their toes into Coinbase as the stock appears to be priced at a very high multiple. He also said that the lack of a lock up period may also be a reason as this gives insiders and early investors little incentive to hold their shares.

Coinbase, the first major cryptocurrency exchange to go public, was viewed by crypto bulls as a milestone for the digital ecosystem as it looks to continue to make headway into mainstream financial markets.

Coinbase does not offer trading in cryptocurrencies that have been seeing explosive rallies in the past few days, such as dogecoin, the meme token that has seen a 13,000% gain year-to-date, or Binance Coin, the third-largest cryptocurrency with a $99 billion valuation.

"Coinbase has been in a steady decline since its debut as many cryptocurrency traders have begun betting big on altcoins and tokens on other exchanges, while some have decided to directly hold their cryptos in a wallet," Edward Moya, senior market analyst at Oanda, told Insider.

Cryptocurrency exchange Gemini allowed customers to trade dogecoin staring this Tuesday, joining a growing list of platforms such as Kraken and Robinhood.

Competition is also a concern. While rival Binance has said it has no plans of going public, Kraken said it could go public next year after seeing an explosion in bitcoin trading volume.