William Blair Analyzes "Crypto Bear Market Nearing Bottom" Despite Lowering Coinbase Earnings Outlook

On July 15, 2026, investment firm William Blair lowered its short-term earnings outlook for Coinbase Global, Inc., reflecting ongoing market volatility. However, along with this downward revision, analysts presented a positive outlook, stating that the crypto industry's slump is finally nearing its bottom and a full-scale recovery will emerge in 2027.

Despite short-term performance weakness, this report suggests the possibility of a strong recovery in 2027, offering a long-term perspective to investors. Analysts evaluated that the current market stagnation could instead be an opportunity for Coinbase to solidify its market dominance.

William Blair expects the second half of 2026 to be the cyclical low for Coinbase's performance. The analysis suggests that the market share secured during the current downturn will become a powerful growth engine when market conditions improve in the future. Analysts predicted that after a period of adjustment throughout 2026, a full-scale earnings rebound will begin starting in 2027.

We believe that market share captured during the downturn will prove sticky as market conditions improve, providing powerful leverage in the next upcycle.

Coinbase's second-quarter 2026 results significantly missed market expectations. Actual earnings per share (EPS) were $0.12, which is $1.39 lower than the analyst estimate of $1.51. Compared to the revenue estimate of $1.59 billion compiled by FactSet, the impact of declining trading volume was clearly evident.

Structural Tailwinds Driven by Stablecoin Growth

William Blair cited the continued growth of USD Coin (USDC) as a key positive factor for Coinbase. According to the report, USDC's share in the dollar stablecoin market has risen from approximately 21% in 2024 to about 27% as of 2026, narrowing the gap with Tether (USDT). This is contributing to the stability of Coinbase's subscription and services revenue.

• USDC supply has surged by approximately 220% since the end of 2023, absorbing institutional and retail demand.
• The retail derivatives segment continues to grow, recording more than $200 million in annualized revenue.
• The Prediction Markets segment is also contributing to business diversification, generating more than $100 million in annual revenue.

Coinbase is accelerating its 'Everything Exchange' strategy, moving beyond being a simple spot exchange. The expansion of its derivatives platform, including support for non-crypto contracts, serves as a key strategy to diversify its revenue structure—which was heavily weighted toward transaction fees—and build resilience against market volatility. This diversification allows the company to maintain solid fundamental strength even in bear markets.

Coinbase's current valuation is undervalued compared to other fintech companies. It is trading at 16.7 times its projected 2026 EBITDA, which is approximately a 50% discount compared to the average multiple of major fintech firms. Considering Coinbase's solid organic revenue growth and Return on Invested Capital (ROIC), William Blair projected that the multiple will recover to the high 20s in the future.

However, in the short term, macroeconomic and geopolitical uncertainties are hindering growth. Coinbase Research maintained its market outlook for the second quarter of 2026 as 'Neutral,' diagnosing that investors are taking a balanced approach to risk assets due to heightened geopolitical risks. These external factors could extend the market's bottoming-out process until the second half of 2026.

In conclusion, 2026 is expected to be a year of adjustment for Coinbase, where downward revisions in earnings forecasts and structural improvements occur simultaneously. William Blair emphasized that the earnings bottom to be formed in the second half of this year will serve as a bridgehead for a full-scale earnings rebound and stock price recovery in 2027. The analysis suggests that the current undervaluation phase could be an entry point for long-term growth.