William Blair cut its revenue and earnings forecasts for Coinbase, citing weaker cryptocurrency trading activity and pressure on transaction-driven income, but the firm kept its Outperform rating and said the current downturn may bottom later this year if Bitcoin stabilizes and newer business lines gain more traction.
The revision reflects a tougher operating backdrop for one of the largest publicly traded crypto companies, as subdued spot trading, falling digital asset prices and capital outflows from spot funds have reduced activity across the market. Coinbase remains closely tied to trading volume, even as it expands into derivatives, prediction markets, stablecoin-related services, blockchain infrastructure and tokenized assets.
William Blair lowered its 2026 revenue forecast for Coinbase by 12% and its 2027 estimate by 13%. The firm also cut its adjusted EBITDA projections by about 34% for both years, signaling a sharper expected hit to profitability than to revenue. The forecast change was driven mainly by expectations that trading volume will remain under pressure in the near term before recovering in 2027.
Despite the reductions, William Blair said it still expects Coinbase to benefit from a more durable market structure than the one seen during the 2022 crypto downturn. The firm pointed to the growth of spot Bitcoin ETFs, rising institutional participation and more flexible regulatory frameworks in major jurisdictions as factors that could help stabilize the market over time.
Coinbase shares rose about 1% to $162.63 in early Wednesday trading. Even with that move, the stock remains down roughly 32% year to date, broadly tracking the weakness in Bitcoin, which has fallen about 26% over the same period.
Trading slowdown weighs on forecasts
The biggest challenge for Coinbase remains the decline in trading activity. William Blair expects total trading volume on the platform to fall about 44% in 2026 to roughly $669 billion. The firm then expects volume to rebound by more than 32% in 2027, suggesting that the downturn may be meaningful but not permanent.
That projected drop matters because transaction fees have historically been one of Coinbase’s most important revenue sources. When traders buy and sell less frequently, or when market volatility fades, fee income tends to weaken. Lower spot volume is especially important because simple buying and selling of crypto assets remains central to Coinbase’s retail business.
The decline in activity has also been reflected in broader market flows. Spot funds saw heavy withdrawals in June, with about $4.06 billion leaving the market during the month. That type of capital movement can reduce liquidity, weigh on sentiment and make it harder for trading platforms to generate the same level of activity seen during stronger market cycles.
The pressure comes after a period in which spot Bitcoin ETFs helped bring more mainstream attention to the asset class. While those funds helped deepen market access, the latest outflows show that crypto-linked products remain vulnerable when prices weaken and risk appetite fades.
William Blair analysts Jeffrey and Choudhury said the current timeline may give the market room to absorb recent losses. They also suggested that a recovery could begin to form as conditions normalize, although the report still reflects caution on near-term trading and earnings expectations.
Coinbase tries to rely less on spot trading
Coinbase has been working to reduce its dependence on traditional spot trading fees. William Blair pointed to several newer revenue opportunities that could help offset weaker trading activity, including retail derivatives, prediction markets and Base, the company’s Layer 2 blockchain network.
Retail derivatives have become a growing area of focus across the digital asset market because they can generate activity even when spot markets are quiet. Derivatives products allow traders to take positions tied to the future price of an asset rather than simply buying or selling the asset directly. That can create additional volume, though it may also bring higher regulatory scrutiny.
Prediction markets are another emerging business line. These platforms allow participants to trade contracts tied to the outcome of real-world events, such as elections, economic data or sports results, depending on regulatory permissions. Coinbase’s exposure to this category could create a new source of engagement if the market continues to expand.
Base may be the most strategically important of the newer Coinbase initiatives. The network is built as a Layer 2 system designed to process transactions more cheaply and efficiently than the Ethereum base layer. It gives Coinbase a foothold in on-chain activity beyond its traditional centralized trading business.
William Blair said Base could generate revenue from trading-related activity, transaction sequencing fees and, potentially, a token issuance in the future. A token launch remains speculative, but the possibility highlights how blockchain infrastructure can create optionality for companies that operate at scale.
Base also positions Coinbase to participate in the expanding market for tokenized real-world assets. These assets can include tokenized Treasury products, private credit, commodities, real estate interests and other traditional financial instruments represented on blockchains. The total value locked in tokenized real-world asset protocols is estimated to exceed $22.5 billion, making it one of the faster-growing areas of the digital asset sector.
Why this cycle looks different from 2022
William Blair described the current downturn as structurally different from the crypto slump of 2022. That earlier period was marked by a series of failures across lenders, funds and trading firms, along with sharp declines in token prices and a collapse in confidence.
The current environment has its own challenges, but it is also supported by different market infrastructure. Spot Bitcoin ETFs have created regulated access points for a wider range of traders. Larger financial institutions are more active in custody, settlement, tokenization and payments. Regulators in several jurisdictions have also moved toward clearer frameworks, even if enforcement and policy debates remain active.
That does not remove the risk for Coinbase. A lower-volume environment can still pressure revenue, and fee compression remains a long-term concern as trading platforms compete for customers. Crypto markets also remain highly sensitive to macroeconomic conditions, interest-rate expectations and swings in liquidity.
Still, the broader market is no longer relying only on offshore trading venues or speculative token launches to drive activity. More infrastructure now exists around ETFs, stablecoins, tokenized assets and scaling networks. For Coinbase, the key question is whether those areas can grow quickly enough to reduce the earnings impact when spot trading slows.
Bitcoin weakness remains central to sentiment
Bitcoin’s decline this year has been a major factor behind Coinbase’s stock performance. The company’s shares often move alongside Bitcoin because higher crypto prices usually bring more trading, stronger retail engagement and improved market sentiment. When Bitcoin falls, activity can dry up quickly.
The top digital asset struggled around the $60,000 level during the June selloff, according to the market backdrop described in the report. That weakness coincided with the sharp outflows from spot funds and heightened concern about near-term demand.
For traders, the immediate issue is that a lower-volume market can feel less forgiving. Simple spot strategies become harder when momentum fades and liquidity thins. In that environment, more activity may shift toward derivatives, on-chain applications, yield products, tokenized assets and event-based markets, depending on risk tolerance and regulation.
William Blair’s revised Coinbase outlook reflects that shift. The firm is not arguing that crypto activity has disappeared, but rather that the old reliance on spot trading volume is under pressure. Coinbase’s ability to maintain growth will depend on whether alternative revenue lines can scale during the next phase of the market.
Ark Invest adds during the selloff
Large asset managers have also been active during the decline. Ark Invest bought about $44 million of Coinbase shares during the June selloff, according to the details provided. The purchase came while broader market attention was focused on Bitcoin’s struggle to stabilize below the $60,000 area.
Ark Invest has historically been one of the more visible supporters of crypto-linked equities, including Coinbase. Its purchase does not remove the near-term operating pressure facing the company, but it shows that some large market players continue to view Coinbase as a long-term proxy for growth in digital assets and blockchain infrastructure.
Coinbase’s stock, however, remains volatile. A 32% year-to-date decline shows that traders have marked down expectations as crypto prices and activity softened. The share price reaction to William Blair’s forecast cut was limited in early trading, suggesting that some of the weakness may already be reflected in the stock.
Stablecoin competition could reshape payments activity
Another development that could affect the broader market is the Open USD project, a planned stable token backed by the Open Standard group. More than 140 companies have joined the group, which is working on a stable token that would charge zero fees for minting.
The project includes major global payments companies such as Visa and Mastercard in its early stages. If successful, Open USD could increase competition in the stablecoin market, where scale, liquidity, trust and distribution are critical.
Stablecoins are central to crypto trading and payments because they allow users to move dollar-linked value across blockchain networks without converting back into bank deposits every time. They are widely used for settlement, collateral, remittances and cross-border transfers. A zero-minting-fee model could appeal to businesses and platforms looking to reduce friction, although adoption would depend on liquidity, regulatory treatment, reserve transparency and integration across wallets and exchanges.
For Coinbase, stablecoin activity matters because the company already benefits from stablecoin-related revenue, especially through its relationship with USD Coin. More competition could pressure some areas of the market, but broader stablecoin adoption may also increase blockchain transaction activity overall.
Outlook depends on recovery in activity
The central message from William Blair’s revision is that Coinbase faces a weaker earnings path in the next two years than previously expected, but the company is not being treated as a broken story. The Outperform rating remains in place because the firm expects the downturn to eventually give way to a recovery, with 2027 seen as the likely year for improvement.
Near-term conditions remain difficult. Trading volume is down, spot fund outflows have been heavy, Bitcoin has weakened and Coinbase’s stock has fallen sharply. Those factors explain the lower revenue and adjusted EBITDA forecasts.
The longer-term case depends on whether Coinbase can prove that its business is becoming more diversified. If Base, derivatives, prediction markets, stablecoin services and tokenized assets continue to grow, Coinbase may become less exposed to the boom-and-bust pattern of retail spot trading.
For now, the company remains caught between two forces: a market downturn that is hurting its core revenue engine, and a broader shift in crypto infrastructure that could create new sources of income. William Blair’s revised forecasts show that the pressure is real, but its maintained rating suggests the firm still sees Coinbase as one of the better-positioned companies if digital asset activity recovers.
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