Why Analysts Aren’t Worried About Coinbase’s 30% Drop

The numbers got worse. The stocks went up.

Coinbase (COIN) and Circle (CRCL) each rose roughly 3--4% on Wednesday after William Blair---a Chicago-based investment bank founded in 1935 that most equity investors know from tech and growth coverage---released a note slashing its revenue and earnings forecasts for Coinbase while keeping its "outperform" rating.

The read in TLDR terms is that the pain is already in the price. "We think investors should stay involved in Coinbase," the firm said.

The firm cut 2026 revenue estimates for Coinbase by 12% and 2027 estimates by 13%, and gutted adjusted EBITDA projections by 34% in both years. Analysts Andrew Jeffrey and Adib Choudhury said earnings are set to trough in the second half of 2026 before recovering in 2027, and that investors should stay the course as spot crypto volume bottoms alongside Bitcoin.

William Blair expects Coinbase's total trading volume to fall roughly 44% this year to $669 billion before rebounding more than 32% in 2027.

The firm sees this cycle as structurally different from 2022: There are now spot Bitcoin ETFs, institutional flows have grown, and the regulatory environment has matured in ways that didn't exist four years ago.

The firm also highlighted Coinbase's Base layer-2 network as a potential major earnings driver, with retail derivatives and prediction markets rounding out a revenue base that extends well beyond spot trading---retail derivatives alone crossed $200 million annualized in the first quarter.

Not everyone was as constructive in the near term. Piper Sandler analyst Patrick Moley cut his price target to $155 from $170, keeping a "neutral" rating. He flagged prediction markets and perpetual futures as the defining story of Q2---the World Cup drove massive growth in prediction market activity---and warned of "significant investor attention on the perpetual future threat" heading into Q3.

Coinbase has fallen nearly 30% this year, alongside a roughly 26% decline in Bitcoin. Circle, which debuted in a splashy June 2025 NYSE IPO at $31 per share, has dropped about 20% since January.

The same directional read is also appearing among technical analysts. John Bollinger---the veteran technical analyst who created Bollinger Bands, volatility envelopes plotted above and below a moving average that traders use worldwide to spot compression and potential breakouts---has been flagging a developing pattern on Bitcoin's daily chart since early July.

On July 2, Bollinger posted his analysis on X, identifying a "W" double-bottom taking shape. A double-bottom is a reversal formation defined by two swing lows with a rebound in between; it turns bullish once price clears the resistance at the apex between the troughs.

He called the setup "perfectly fractal"---smaller versions of the same shape nest inside the larger structure, and the pattern is also visible on the weekly chart. He was upfront about the uncertainty: previous bullish setups had been invalidated by selling pressure throughout this cycle.

In a more recent post, Bollinger mentioned that If this "W" completes, he would see it as "a confirmation of a change in trend." That's his clearest public signal yet that the trend may be turning rather than pausing.

Bollinger disclosed a long Bitcoin position through his investment vehicle earlier this year, so his analysis and his book are pointing the same direction. In terms of technical analysis, the price of Bitcoin remains bearish, but that trend is losing strength.

According to Glassnode's latest weekly analysis, long-term holder capitulation---the main source of selling pressure all year---set its cycle peak two weeks ago and has turned down. The metric that measures what long-term holders actually surrender each day, adjusted to exclude internal transfers, reached a peak and is now falling for the first time this cycle.

Buyers showed up at the June lows. Glassnode documented a broad wave of accumulation across wallets of all sizes during that period. Bitcoin's inverse relationship with the dollar has deepened while its correlation with U.S. equities has loosened, and its sensitivity to good macro news has returned: Tuesday's soft inflation print moved Bitcoin more sharply than any major equity index.

The sticking point is the same for on-chain analysts and Wall Street alike---no sustained spot-driven buying has confirmed the recovery yet.

Derivative positions are unwinding, long-term sellers are thinning, and the fear premium in the options market is easing. But the capital hasn't fully arrived. William Blair puts the inflection point at 2027, projecting a 32% rebound in Coinbase trading volume after this year's expected 44% decline.