Benchmark: Coinbase Weakness Is Temporary, Long-Term Bullish Case Remains Strong
Coinbase’s (COIN) underwhelming Q2 earnings may have triggered a sharp sell-off, but Benchmark sees the dip as a strategic entry point rather than a signal of deeper trouble.
Following Friday’s 16.7% drop in COIN shares, analyst Mark Palmer reaffirmed a Buy rating and maintained his $421 price target, citing confidence in the company’s long-term growth trajectory.
“The fundamentals supporting Coinbase’s role in the crypto ecosystem remain strong,” Palmer wrote. Shares rebounded slightly Monday, rising 1.8% in early trading.
Benchmark outlined five catalysts backing its bullish stance:
- USDC Revenue-Sharing: Coinbase’s agreement with Circle positions it to benefit from the growing adoption of stablecoins, especially after the passage of the GENIUS Act.
- Institutional Expansion: Prime brokerage, crypto-as-a-service, and derivatives offerings are well-aligned with potential tailwinds from the CLARITY Act.
- Crypto Super App: Coinbase is developing an all-in-one platform that integrates trading, DeFi, NFTs, and developer tools—aimed at consolidating its dominance in the U.S. market.
- Decentralized Exchange Access: Adding support for DEXs boosts token variety and market depth beyond centralized options.
- Trading Activity Rebound: Estimated July transaction revenue of $360 million marks a 44% jump from Q2’s monthly average, suggesting improved user engagement.
Despite the recent earnings miss, Benchmark maintains that Coinbase’s positioning, regulatory tailwinds, and product innovation keep its long-term outlook intact.
