Coinbase hit by spot trading slump: Wall Street trims expectations ahead of earnings
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- Barclays, Benchmark, Clear Street, and Compass Point all slashed Q2 estimates for Coinbase ahead of Thursday's earnings, citing sharply lower spot trading activity industry-wide in April and May.
- Barclays' Benjamin Budish estimates Coinbase processed roughly $152 billion in Q2 trading volume versus the Street's ~$178 billion expectation, projecting adjusted EBITDA about 3% below consensus on weaker blockchain rewards and institutional trading revenue.
- Clear Street's Owen Lau projects approximately $160 billion in trading volume and $301 million in adjusted EBITDA, while Benchmark's Mark Palmer reduced his EBITDA forecast to $377 million.
- Subscription and services revenue — including USDC interest, staking rewards, custody fees, and Coinbase One — is expected to provide ballast against weaker transaction revenue, though Compass Point warns it could land below the midpoint of management's guidance due to softer crypto prices and slower stablecoin growth.
- Prediction markets have emerged as one of Coinbase's fastest-growing businesses around sporting events, but Compass Point argues investors may overestimate profitability because Coinbase records gross revenue while sharing economics with Kalshi, making net contribution smaller than headline figures suggest.
- The Clarity Act establishing a U.S. digital-asset regulatory framework is viewed as the biggest potential catalyst — Benchmark sees improved Senate passage odds after movement on ethics provisions, while Compass Point warns the August recess timeline leaves little room and a stall could pressure COIN's valuation.
- COIN shares traded about 1.7% lower at $165 on Wednesday ahead of the print.
Why it matters: Coinbase's Q2 results will test whether subscription revenue, prediction markets, and derivatives can meaningfully offset the company's persistent dependence on spot trading fees. With subscription and services providing only partial cushion and the Clarity Act's fate uncertain before the August recess, the report carries outsized weight for COIN's $165 stock price heading into the second half.
