Coinbase Stock Drops 35.6% Year to Date, Despite Bullish Analyst Outlook

Coinbase’s stock price has been under significant pressure, hovering around $165 at 1:30 pm ET, marking a 35.6% decline year to date. This performance is notably worse than that of Bitcoin (BTC) and the Nasdaq Composite Index, which have decreased by 13.6% and 15.2%, respectively, since the start of 2025.

Despite the challenging market conditions, Cantor Fitzgerald initiated coverage of Coinbase with a buy rating and a $245 price target. The analysts at Cantor Fitzgerald are optimistic about the future of Web3 and believe that Coinbase is well-positioned to capitalize on this emerging technology. They highlight the robust user growth on Coinbase’s layer-2, Base, and the potential for Coinbase’s stablecoin revenue to grow significantly. According to the analysts, stablecoins have the potential to displace traditional cross-border payment rails, which could further bolster Coinbase’s business.

“As such, we expect COIN’s business to be perceived less as a cyclical trading platform and more as a mission-critical infrastructure layer of the crypto economy,” the analysts wrote. This perspective suggests that Coinbase’s value proposition extends beyond short-term market fluctuations, positioning it as a foundational element of the crypto ecosystem.

Michael Miller, an analyst at Morningstar, has adjusted his fair value estimate for Coinbase’s stock. Initially, he believed the company’s shares were overvalued, but he now sees the stock as slightly undervalued. Miller’s current fair value estimate for COIN remains at $170. However, he cautions that Coinbase’s business is heavily exposed to cryptocurrency valuations, which significantly influence its trading revenue and have a direct impact on its custody and staking revenue.

Other stocks tied to the crypto industry have also faced challenges. Strategy and Marathon Digital are down 9.3% and 33.2% year to date, respectively. Galaxy Digital, which is expected to go public in the US next month, has seen a 48% decline in its share price. Meanwhile, Robinhood, which generated $358 million in crypto revenue in Q4 2024, has maintained its share price at levels similar to the start of the year.