Coinbase's Weak Q2 Is a Blip, Not a Breakdown, Says Benchmark

3 months ago 18

Weakness in Coinbase stock is a buying opportunity, according to the broker.

Aug 4, 2025, 12:07 p.m.

Coinbase’s (COIN) softer-than-expected second quarter results triggered a sharp Friday sell-off, but Wall Street broker Benchmark says the drop is a buying opportunity, not a red flag.

Analyst Mark Palmer reiterated his buy rating and $421 price target. He argued that the exchange's long-term investment case remains intact as the company continues to build foundational crypto infrastructure.

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The shares are 1.8% higher in early trading Monday, after having closed 16.7% lower on Friday.

Benchmark highlights five catalysts supporting its thesis. First, Coinbase's revenue-sharing agreement with Circle on USDC reserves positions it to benefit from stablecoin adoption, especially after the U.S. passed the GENIUS Act.

Second, its institutional offerings, including prime brokerage, crypto-as-a-service and derivatives, are well-timed because the CLARITY Act may spur further adoption.

Third, the firm is developing a crypto “super app” integrating trading, payments, non-fungible tokens (NFTs), decentralized finance (DeFi) and developer tools, a unique product in the U.S. market.

Fourth, the integration of decentralized exchanges expands token access beyond centralized listings.

Finally, Coinbase’s estimated $360 million in July transaction revenue, a 44% jump from its monthly average during the second quarter, signals a potential recovery in crypto activity.

Benchmark concludes the quarter's miss is short-term noise. Coinbase’s evolving platform, underpinned by regulation tailwinds and increasing institutional demand, points to long-term growth.

Disclaimer: Parts of this article were generated with the assistance from AI tools and reviewed by our editorial team to ensure accuracy and adherence to our standards. For more information, see CoinDesk's full AI Policy.

Will Canny

Will Canny is an experienced market reporter with a demonstrated history of working in the financial services industry. He's now covering the crypto beat as a finance reporter at CoinDesk. He owns more than $1,000 of SOL.

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