Mizuho lowers BitGo price target to 11 dollars, cites potential benefits from Clarity Act delays

Mizuho analysts have reduced their price target for BitGo (BTGO) shares from 14 dollars to 11 dollars. The stock was trading at 5.61 dollars as of 2:47 p.m. EST. Despite the cut, Mizuho maintained an Outperform rating, viewing BitGo as a "high-growth/recurring revenue business" with a 27% year-over-year increase in its customer base. The analysts suggest that delays in U.S. crypto market-structure legislation could benefit BitGo by extending its regulatory head start over competitors. BitGo operates the first federally chartered digital asset trust bank owned by a publicly traded company, which positions it favorably regardless of new legislation. The Clarity Act aims to establish a federal framework for digital assets but has faced delays. Mizuho believes that as long as the regulatory framework remains unsettled, BitGo's compliance advantages will grow, raising barriers for new entrants. In Q2, BitGo reported total revenue of 4.33 billion dollars, a 79.6% increase year-over-year, but posted a net loss of 19 million dollars, an improvement from a 60.7 million dollar loss in the previous quarter. Mizuho's analysis indicates that BitGo's partnerships with DTCC, Canton, and Figure could position it as a key player in tokenized securities and onchain financial products.

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