Coinbase hit by spot trading slump: Wall Street trims expectations ahead of earnings

Coinbase experienced a significant decline in spot trading volumes during the second quarter of 2026, with trading activity dropping sharply in April and May. This downturn prompted several major Wall Street firms, including Barclays, Benchmark, Clear Street, and Compass Point, to lower their earnings forecasts for Coinbase ahead of the company's earnings report. Barclays estimated that Coinbase processed approximately $152 billion in trading volume during Q2, well below the previously expected $178 billion, and predicted adjusted EBITDA to be around 3% below consensus due to weaker blockchain rewards and institutional trading revenue.

Despite the softness in spot trading, analysts generally see some stability in Coinbase’s subscription and services revenue, which includes income from USDC stablecoin interest, staking rewards, custody fees, and institutional services. This revenue stream is considered less sensitive to daily trading volume fluctuations and is expected to provide some cushion against the decline in transaction fees. However, opinions vary somewhat, with Compass Point expressing caution that revenue from this segment might fall below the midpoint of management guidance, mainly due to weaker crypto prices and slower stablecoin growth.

Analysts are also paying close attention to Coinbase’s newer business initiatives, such as prediction markets and derivatives trading. Prediction markets have recently become one of Coinbase’s fastest-growing areas, largely driven by increased activity related to sporting events. Barclays and Clear Street view these as meaningful long-term growth drivers, while Compass Point questions the profitability after accounting for revenue-sharing with partners like Kalshi. Derivatives trading, including the company’s exposure through its acquisition of Deribit, is seen as a promising opportunity but contributed little to offset the Q2 spot trading weakness.

Regulatory developments remain a critical factor influencing investor sentiment around Coinbase. The Clarity Act, a proposed U.S. federal digital asset regulatory framework, is viewed by some, like Benchmark, as a potential catalyst if passed, improving the outlook for Coinbase. However, other analysts, including those at Barclays and Compass Point, remain cautious due to tight legislative timelines and competing Washington priorities, warning that delays could pressure Coinbase’s stock valuation. The upcoming earnings report is expected to be backward-looking, with investors focusing more on management’s guidance for the second half of the year and the company’s progress in diversifying revenue away from spot trading dependence. As of the article’s writing, Coinbase shares were down about 1.7%, trading near $165.