Bernstein Signals Potential Bottom Into Q1 Earnings for Coinbase, Robinhood and Figure as Crypto Equities Trade at Steep Discounts

Bernstein Research has noted that equities tied to crypto infrastructure are trading at steep discounts following a broad market selloff. These valuations now reflect weak near-term sentiment rather than long-term growth prospects according to Bernstein analysis. Despite this, businesses in the crypto sector continue to expand, particularly in stablecoins and tokenized assets as reported.

The firm anticipates that this weakness will persist into Q1 earnings before stabilizing. Bernstein expects a potential bottom to form in the first quarter, suggesting that the current market selloff has overshot fundamental business growth according to Bernstein. While maintaining an outperform rating for Coinbase, the firm revised its price target downward to $330 from $440 previously as part of its analysis.

Coinbase is currently facing a regulatory and market challenge as it resists a provision in the CLARITY Act. This provision would ban passive yield on stablecoin balances, directly threatening Coinbase's $1.35B in stablecoin-related revenue according to Blockonomi. The company has raised concerns about the bill's ambiguous language, warning it could be used against the broader crypto industry in the future as reported.

How Is Coinbase Responding to the CLARITY Act?

Coinbase is working on a counterproposal to address the yield restrictions in the CLARITY Act while supporting most of its provisions according to analysis. The White House has warned that further delays could jeopardize the entire legislative deal, adding urgency to the situation as noted. This regulatory uncertainty has also led to public backlash from users and industry figures, with some calling for a boycott of Coinbase services as reported.

The firm is struggling to model future earnings due to the bill's unresolved definitions of permissible rewards. This uncertainty has exacerbated concerns among investors and users according to market analysis. The situation highlights a growing divide in the industry, with some stakeholders accepting the proposed compromise while Coinbase resists it as observed.

What Is the Outlook for Robinhood and Coinbase?

Robinhood has shown strong performance in 2025, posting record revenue and profit. The firm reported $4.5 billion in full-year revenue and $1.9 billion in net income according to Investment News. Its diversification into financial services, including prediction markets and margin accounts, has contributed to its success as noted.

Coinbase, on the other hand, has underperformed compared to its IPO valuation, with a year-to-date decline of 28.6% according to Yahoo Finance. This decline is attributed to crypto market volatility and rising operating costs. Analysts at Goldman Sachs, however, see potential for a 30% upside in Coinbase stock, citing structural expansion and growth in derivatives and stablecoins as reported.

What Are Analysts Watching Next?

The coming quarter will be critical in determining whether the market has bottomed out. Bernstein predicts that the current weakness in crypto equities will stabilize during Q1 earnings, with a potential bottom forming in the near future according to Bernstein analysis. For Coinbase, regulatory clarity and market adoption of its stablecoin ecosystem are key factors that could drive performance as analysts note.

Robinhood continues to benefit from its diversified financial services strategy, with growth in areas like options trading and margin lending as reported. However, investors remain cautious about crypto-related revenue streams, which are still subject to market volatility according to Investment News.

Investors are also watching whether the CLARITY Act will pass in its current form and how Coinbase will navigate regulatory challenges while maintaining its business model according to industry analysis. The outcome could have broader implications for the crypto industry's regulatory landscape and earnings potential as noted.