Coinbase faces revenue headwinds as lower interest rates threaten to slow growth in stablecoin interest income, which currently contributes nearly 20% of overall revenue. Operating expenses in sales, R&D, and G&A are rising due to acquisitions and headcount growth, creating potential margin pressure into 2026 as management frames 2025 as an investment year. Coinbase trades at a lower premium vs. sector peers and vs. own history, but flat earnings expectations limit how much this valuation discount can support the stock.
COIN has failed multiple times at a key technical resistance level vs. the S&P 500, and recent price action suggests growing risk of downside and underperformance ahead. A more accommodative regulatory environment globally remains an upside risk that could expand Coinbase’s market opportunities.
Lower interest rates are expected to slow stablecoin interest income, a key revenue stream comprising almost 20% of COIN’s total, pressuring overall revenue growth. Increased R&D and G&A expenses from acquisitions and headcount growth, with Q4 guidance showing an 11.9% QoQ rise, are likely to compress operating EBIT margins as we head into FY26. While COIN trades at a 22.7% discount to its historical PE and a reduced sector premium, flat earnings expectations and technical resistance failures limit the case for upside.
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