Shares of Coinbase Global Inc. climbed 3.3% on Friday, closing the trading session at $171.35. The move higher coincided with a period of relative stability in major cryptocurrency markets, with Bitcoin trading near $68,607 and Ether around $1,994 on Saturday, both showing daily gains. The advance comes as the digital asset exchange navigates a complex landscape of regulatory engagement and shifting market dynamics.
Ongoing Washington Dialogue on Stablecoins
Policy developments remained a central focus for investors. Lobbyists from the cryptocurrency and banking sectors convened at the White House on Thursday, February 19, for their third meeting in roughly two weeks. The discussions centered on the regulatory treatment of "stablecoin rewards"—interest-like payments associated with dollar-pegged tokens. These talks are seen as a critical component of broader efforts to establish a regulatory framework for digital assets in the United States.
Participants described the dialogue as constructive. Stuart Alderoty of Ripple noted on social media that the group "rolled up our sleeves and went through specific language." Paul Grewal, Coinbase's Chief Legal Officer, characterized the tone as "cooperative." Despite the ongoing talks, no formal agreement was reached, leaving a key policy question unresolved as the market heads into the new week.
Wall Street Adjusts Targets on Volume Concerns
While the stock price moved higher, analyst sentiment reflected growing caution. Compass Point Research & Trading significantly reduced its price target for Coinbase to $140 from $190, maintaining a Sell rating. The firm pointed to a noticeable decline in both spot and derivatives trading volumes following the company's fourth-quarter earnings report. It noted that retail investor "apathy" often defines crypto market downturns and highlighted that increased competition from established fintech and electronic brokerage firms, partly driven by the prospect of clearer regulations, is intensifying.
In a separate move, Monness, Crespi, Hardt & Co. recently downgraded Coinbase to Sell, assigning a $120 price target. Analyst Gus Gala observed that historical crypto bear markets have averaged approximately 350 days from peak to trough. He projected continued weakness for Coinbase's business into the first half of 2026, with his forecasts set below the broader analyst consensus.
Revenue Mix and Regulatory Pushback
The regulatory focus on stablecoin rewards touches a vital revenue stream for Coinbase. The company reported a quarterly loss earlier this month, driven primarily by softer transaction revenue from trading. However, its revenue from subscriptions and services, which includes stablecoin-related income, rose to $364.1 million. A significant portion of this stems from its partnership with Circle and the USDC stablecoin, through which Coinbase earns interest on the token's reserve assets. CEO Brian Armstrong has publicly opposed suggested regulatory limits on such stablecoin yields.
Technical Glitch and Broader Market Moves
Coinbase also addressed a minor technical issue on Friday, noting on its status page that it was investigating a display problem affecting how decentralized exchange (DEX) token balances appear on user accounts. The company assured customers that the issue was purely visual and that funds remained secure. Elsewhere in the market, other companies with crypto exposure saw modest moves. Robinhood Markets gained about 0.6% to close at $76.11, while Strategy, a firm known for holding Bitcoin, rose roughly 1.2% to $131.05.
Macroeconomic Backdrop and Forward Look
Broader economic indicators are returning to the forefront for traders. Recent data showed U.S. core Personal Consumption Expenditures (PCE) inflation rose 0.4% in December, bringing the annual rate to 3.0%. This reading may temper expectations for imminent interest rate cuts from the Federal Reserve, a factor that cryptocurrency markets often react to swiftly. Looking ahead, market participants are anticipating the release of the U.S. Producer Price Index for January on February 27, followed by the next PCE price index report scheduled for March 13.
The path forward for Coinbase remains intertwined with regulatory outcomes. A breakdown in the White House stablecoin talks, or legislation that effectively prohibits yields on stablecoin balances, could further stall comprehensive U.S. crypto legislation and impact key parts of Coinbase's revenue. Additionally, another downturn in Bitcoin's price would likely pressure trading volumes anew, while any signs of platform instability could unsettle markets already characterized by thin liquidity.
