GraniteShares 2x Short COIN Dai (CONI)

CONI has declined a further 3.51% to $48.31 since the August 13 report, extending its losing streak despite Coinbase's deteriorating second-quarter fundamentals, as a relief rally in the underlying equity and renewed crypto optimism weigh on the 2x inverse structure. The ETF is down 29.18% year-to-date and 47.47% over six months, with the latest single-day drop of 6.58% marking the most aggressive selling in the recent sequence. Near-term conviction for a sustained CONI recovery remains contingent on Coinbase reversing its current rebound and resuming a downtrend.

Key Updates

Since the August 13 report, CONI has fallen from $50.07 to $48.31, a decline of 3.51%, building upon the prior session's weakness. The five-day return has deteriorated to -12.13%, indicating accelerating downward momentum that has erased the August 12 rebound. This price action suggests the underlying Coinbase exposure has continued to strengthen against the short positioning, frustrating the bearish thesis that appeared intact following the July 30 earnings disappointment.

Current Trend

CONI remains in a pronounced downtrend across all measured timeframes. Year-to-date losses stand at 29.18%, while the six-month decline of 47.47% underscores sustained erosion in the leveraged inverse structure. The one-month return of -3.47% has been overwhelmed by the recent five-day drop of -12.13%, signaling a deterioration in short-term momentum. The sequence of lower highs and lower lows persists: from the August 11 level near $52.01, the brief August 12 bounce failed to hold, and successive closes at $50.07 and now $48.31 confirm bearish price progression for the ETF.

Investment Thesis

The investment thesis for CONI rests on the inverse, leveraged performance of Coinbase Global (COIN). The provided data indicates conflicting fundamentals for the underlying: Coinbase reported a wider-than-expected Q2 2026 loss of $1.36 per share against a $0.17 estimated loss, with revenue declining to $1.2 billion from $1.5 billion year-over-year and net losses of $359.5 million versus prior-year profit. However, options markets have displayed strongly bullish positioning, with over 114,000 calls trading against 50,000 puts and a rebound off the $150 support level. Analyst estimates have been reduced materially—William Blair cut 2026 and 2027 revenue estimates by 12% and 13% and adjusted EBITDA by 34%—yet the firm maintained an "outperform" rating, forecasting a 32% trading volume rebound in 2027. For CONI to realize value, Coinbase must underperform these diminished expectations and break technical support, while crypto sentiment must sour sufficiently to override the structural decay inherent in daily leveraged inverse products.

Thesis Status

The thesis is currently under pressure. The fundamental catalyst from Coinbase's Q2 earnings miss has not translated into sustained CONI appreciation; instead, the ETF has declined 3.51% since the last report and 12.13% over five sessions. This divergence indicates that market participants are looking through near-term earnings weakness toward a anticipated 2027 recovery, or that technical positioning and options flow are dominating fundamental deterioration. Until Coinbase fails to hold the $150 support zone and breaks lower with volume, the CONI bearish thesis remains unconfirmed and subject to continued erosion from leverage decay and risk-on sentiment.

Key Drivers

Primary drivers for CONI include the following developments:

• Coinbase Q2 2026 earnings significantly missed expectations, with a net loss of $359.5 million and revenue of $1.2 billion falling short of the $1.3 billion consensus, driven by soft transaction revenue in a range-bound bitcoin market. Source
• Options markets signaled strong bullish sentiment in mid-July, with call purchases outpacing put purchases by more than four-to-one and over $80 million in call premium trading, tied to expectations for a crypto recovery. Source
• William Blair reduced 2026 and 2027 revenue and EBITDA estimates for Coinbase but maintained an "outperform" rating, projecting a 44% decline in 2026 trading volume to $669 billion followed by a 32% rebound in 2027. Source
• Technical indicators on Bitcoin, including a completed "W" double-bottom pattern flagged by John Bollinger and Glassnode data showing long-term holder capitulation peaking, are contributing to a constructive view on crypto assets that indirectly supports Coinbase. Source
• Piper Sandler cut its Coinbase price target to $155 from $170 with a "neutral" rating, focusing on prediction markets and perpetual futures as alternative revenue streams. Source

Technical Analysis

CONI is trading at $48.31, having broken below the August 11 low of $49.58 and the August 13 close of $50.07. The 6.58% single-day decline is the largest in the recent sequence and confirms selling pressure has intensified. There is no evidence of a established support level in the immediate vicinity based on the provided price history; the next reference points derive from the progression of lower lows since early August. Resistance is now clearly defined at $50.07 (prior close) and $52.01 (August 11 high). The five-day return of -12.13% versus the one-month return of -3.47% indicates that the majority of recent monthly losses have concentrated in the past week, a bearish short-term momentum signal for the inverse ETF.

Bull Case

• Coinbase reported a Q2 net loss of $359.5 million, significantly missing consensus expectations for both revenue and earnings, with transaction revenue softening amid a range-bound bitcoin market and sustained ETF outflows, suggesting underlying business deterioration that could pressure COIN lower and benefit the short structure. Source
• William Blair slashed its 2026 and 2027 revenue estimates by 12% and 13% and adjusted EBITDA projections by 34%, reflecting fundamental downgrades that, if realized, would reduce Coinbase's valuation and support inverse positioning. Source
• Coinbase has fallen approximately 30% year-to-date, demonstrating significant weakness in the underlying equity that could resume if the mid-July bounce proves to be a dead cat rally within a broader downtrend. Source
• Piper Sandler's reduced price target of $155 and "neutral" rating indicate limited near-term upside conviction among sell-side analysts, constraining the bullish narrative for COIN. Source
• CEO Brian Armstrong's emphasis on all-time high market share may indicate the company is prioritizing volume over profitability, a dynamic that could compress margins and weigh on the stock. Source

Bear Case

• Options activity was strongly bullish in mid-July, with call purchases outpacing put purchases by more than four-to-one and over $80 million in call premium, reflecting aggressive positioning for a crypto comeback that would drive COIN higher and CONI lower. Source
• Coinbase rebounded approximately 11% from below $150, a level that has served as support multiple times since early 2024, indicating strong technical demand for the underlying equity that directly pressures the inverse ETF. Source
• William Blair maintained an "outperform" rating despite estimate cuts, forecasting a 32% rebound in Coinbase trading volume in 2027, which implies a cyclical bottom and recovery narrative that is incompatible with sustained CONI appreciation. Source
• Technical analyst John Bollinger identified a completed "W" double-bottom pattern on Bitcoin's daily chart as confirmation of a trend change, while Glassnode data indicated that long-term holder capitulation peaked and has begun to decline, signaling a potential bottoming in crypto assets that would pressure inverse structures. Source
• Coinbase subscription revenue rose to $555 million, evidencing business model diversification and revenue stability despite transaction revenue headwinds, which may support the equity valuation and constrain downside. Source
• Robinhood Markets exhibited parallel bullish options activity with call buying outpacing put buying by sixfold, indicating broad sector optimism among crypto-facing brokerages that could sustain risk-on sentiment and frustrate short positioning. Source