Coinbase is about to rocket out of the slump it’s been in since its December high, according to a Tuesday research note from Bernstein.
Coinbase revenue will surge by 40% by the end of 2026, and its stock will appreciate 69% to a $310 price, according to Bernstein’s estimates.
Coinbase is “best positioned to be the primary beneficiary of the Trump government’s aspiration to make America” the crypto capital of the planet, wrote Bernstein analysts Gautam Chhugani, Mahika Sapra and Sanskar Chindalia.
To achieve his goal, President Donald Trump has pledged to relax US crypto laws, appointed industry-friendly candidates to key positions, and fired off a barrage of pro-crypto executive orders.
Trump’s policies will boost the industry as a whole, and push Bitcoin to $200,000 over the next year, Bernstein wrote.
‘Amazon of crypto’
Coinbase will be a key beneficiary of these regulatory tailwinds thanks to its position as an “Amazon of crypto” that offers a one-stop shop of crypto services beyond trading, Bernstein wrote.
This has enabled Coinbase to become the preferred US crypto partner for traditional institutions, Chhugani, Sapra and Chindalia wrote.
Eight out of 11 asset managers, including BlackRock, partner with Coinbase to custody their spot Bitcoin exchange-traded products.
Coinbase is the dominant player and controls 66% of the US market, according to Bernstein.
The Securities and Exchange Commission has also agreed in principle to drop its case against Coinbase.
Growing competition
To be sure, Coinbase is not the only one to benefit from Trump tailwinds.
The SEC has also dropped or paused cases against Coinbase rivals like Kraken, Gemini and Robinhood.
At the same time, the SEC rescission of SAB 121, a rule that enforced hefty burdens on US firms wanting to hold crypto, has also provided banks and other players an opportunity to compete for a market slice.
“Fresh competition is emerging from a new pack of broker-dealers, with Robinhood emerging as the most credible new-age competitor,” Chhugani, Sapra and Chindalia wrote.
Trading app Robinhood has offered crypto services since 2018. Those services grew by 700% in the last quarter to make up about half of its transaction based revenues.
“We can be a major player,” Johann Kerbrat, the trading app’s crypto boss, told DL News in January.
Analysts seem to agree. In February, Morgan Stanley argued that Robinhood will be able to leverage its name recognition and compliance record to take market shares from competitors. Bernstein has also said that Robinhood’s crypto push will boost its stock.
Bernstein also noted that there is a risk that Coinbase’s arch-rival Binance may ramp up its services in the US.
Last week, the Wall Street Journal reported that Binance was in talks with Donald Trump’s family to sell a stake in its US business and potentially pardon founder Changpeng Zhao. Zhao has denied being in talks for a Binance US deal or a pardon.
Coinbase currently trades at $181.40, down about 52% from its 52-week high of $349.75 reached on December 6.
Andrew Flanagan is a markets correspondent for DL News. Have a tip? Reach out to [email protected].
