Barclays Downgrades Coinbase as Volumes Fall
Get the Finance newsletter
Daily finance — markets, central banks, M&A, the prints that move money. Free.
- Barclays downgraded Coinbase, warning that global crypto trading activity has fallen to its lowest level since the end of 2023 and projecting adjusted EBITDA about 24% below Street estimates.
- Coinbase saw its March trading volume hit the lowest month since September 2024, with April showing no improvement, and Q1 volumes estimated to be roughly 30% lower than the previous quarter.
- Oppenheimer cut its Q1 volume estimate for Coinbase to $211 billion (down from $244 billion) and revised total revenue expectations to $1.48 billion, below prior forecasts and consensus.
- Oppenheimer highlighted that Circle’s USDC stablecoin network continued to expand, with stablecoin market cap and USDC transfer volume rising about 1% and 12% quarter‑over‑quarter, respectively.
- Bullish reported strong on‑platform activity tied to February volatility, yet spot volumes missed expectations, leading Rosenblatt to downgrade BLSH and Compass Point to downgrade Circle.
- Tokenized assets reached a record $28.9 billion in May, marking the tenth consecutive monthly all‑time high, while the stablecoin market cap extended its run to $320 billion.
- Barclays expressed skepticism that Coinbase’s “everything exchange” strategy will generate near‑term profit, noting it may take a long time to pay off and that the firm has little “right to win” in new asset classes like equities.
Why it matters: Coinbase’s investors and shareholders stand to lose as the firm’s adjusted EBITDA is projected 24% below Street expectations and trading fees shrink from a 30% volume drop, while Circle’s USDC expansion offers a modest counterbalance, potentially softening the broader sector’s earnings decline.
