Interest income from Circle’s USD Coin (USDC) has become increasingly important for crypto exchange Coinbase (COIN), accounting for 10%-15% of third quarter revenue, amid deteriorating sentiment and trading volumes, Mizuho said in a research report Friday.

Mizuho expects depressed crypto trading volumes for 2023 - 2024, resulting in lower revenue for the exchange. The bank cut its rating on Coinbase shares to underperform from neutral with a new price target of $30 from $42. Coinbase shares fell 2.8% to $41.60 in premarket trading.

Any potential changes to Coinbase’s USDC income from Circle could have an “amplified adverse effect on its profitability,” the report said.

(by Will Canny)