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Coinbase's Weak Q2 Is a Blip, Not a Breakdown, Says Benchmark
Weakness in Coinbase stock is a buying opportunity, according to the broker.
Updated Aug 4, 2025, 1:28 p.m. Published Aug 4, 2025, 12:07 p.m.
What to know:
- Weakness in Coinbase stock is a buying opportunity, according to broker Benchmark.
- Benchmark analyst Mark Palmer reiterated his Coinbase buy rating and $421 price target.
- Coinbase shares were 1.8% higher in early trading.
Coinbase’s (COIN) softer-than-expected second quarter results triggered a sharp Friday sell-off, but Wall Street broker Benchmark says the drop is a buying opportunity, not a red flag.
Analyst Mark Palmer reiterated his buy rating and $421 price target. He argued that the exchange's long-term investment case remains intact as the company continues to build foundational crypto infrastructure.
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The shares are 1.8% higher in early trading Monday, after having closed 16.7% lower on Friday.
Benchmark highlights five catalysts supporting its thesis. First, Coinbase's revenue-sharing agreement with Circle on USDC reserves positions it to benefit from stablecoin adoption, especially after the U.S. passed the GENIUS Act.
Second, its institutional offerings, including prime brokerage, crypto-as-a-service and derivatives, are well-timed because the CLARITY Act may spur further adoption.
Third, the firm is developing a crypto “super app” integrating trading, payments, non-fungible tokens (NFTs), decentralized finance (DeFi) and developer tools, a unique product in the U.S. market.
Fourth, the integration of decentralized exchanges expands token access beyond centralized listings.
Finally, Coinbase’s estimated $360 million in July transaction revenue, a 44% jump from its monthly average during the second quarter, signals a potential recovery in crypto activity.
Benchmark concludes the quarter's miss is short-term noise. Coinbase’s evolving platform, underpinned by regulation tailwinds and increasing institutional demand, points to long-term growth.
Read more: Coinbase Slides Nearly 20% in Worst Weekly Performance Since September 2024
AI Disclaimer: Parts of this article were generated with the assistance from AI tools and reviewed by our editorial team to ensure accuracy and adherence to our standards. For more information, see CoinDesk's full AI Policy.
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Coinbase Sees Crypto Recovery Ahead as Liquidity Improves and Fed Rate Cut Odds Climb
The crypto exchange also took note of a so-called AI bubble that continues to go strong and a weaker U.S. dollar.
What to know:
- Coinbase Institutional is seeing a potential December recovery in crypto, citing improving liquidity and a shift in macroeconomic conditions that could favor risk assets like bitcoin.
- The firm's optimism is driven by rising odds of Federal Reserve rate cuts, with markets pricing in a 93% chance easing next week, and improving liquidity conditions.
- Several recent institutional developments, including Vanguard's crypto ETF policy reversal and Bank of America's greenlighting of crypto allocations, have contributed to bitcoin's rebound from recent lows.
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