Summary Coinbase Global is executing a major product expansion into tokenized stock trading and prediction markets, aiming to become an 'Everything Exchange.' COIN remains highly profitable in crypto, with stablecoin revenues surging to $355 million in Q3'25 and subscription revenues at $747 million, up $190 million YoY. The company has multiple shots on goal—stablecoins, tokenized stocks, prediction markets—making COIN too compelling to ignore near yearly lows. Despite near-term volatility in crypto transaction volumes, the stock trades at just ~15x EV/FY26 adjusted EBITDA, appearing remarkably cheap relative to its growth runway. Despite positive regulatory developments in the crypto space, Coinbase Global, Inc. ( COIN ) has slumped the last 6 months. The crypto exchange is rapidly expanding into new categories, though growth in core products likely pushes the stock higher. My investment thesis is ultra Bullish on the stock following the sell off. Source: Finviz Major Product Expansion Coinbase is highly profitable from a strong crypto business, but the company is quickly expanding into zero-commission stock trading via tokenization and prediction markets. Coinbase is working on building an "Everything Exchange" to handle all of the financial transactions for a customer. Coinbase held an event back in December called Coinbase System Update 2025 where the company launched stock trading. At the same time, the company started rolling out the prediction markets business and recently bought The Clearing Company to provide the talent to grow trading on real-world events. The biggest risk is that these markets are already highly competitive with strong private players like Kalshi ( KALSHI ) and innovative fintechs like Robinhood Markets ( HOOD ). While Coinbase is also moving into stock trading, large fintech players like SoFi ( SOFI ) are now moving into crypto trading and using stablecoins for payments. In addition, the prediction markets are very early in development. Kalshi is one of the market leaders and only generated an estimated 2025 revenue of $264 million , though the December transaction fee revenues alone were an estimated $64 million, due primarily to sports predictions. Ultimately, Coinbase needs to just focus on the crypto lead and dive further into the growing opportunity in stablecoins. USDC now has a $74 billion market cap, but more importantly Coinbase generated $355 million worth of revenues during Q3'25, up $108 million YoY. Source: Coinbase Q3'25 shareholder letter The overall business is very volatile due to the large swings in transaction revenues. The Q3'25 revenues of $1.05 billion was actually down over $500 million from the Q4'24 peak. Coinbase continues to make huge progress expanding the subscription and services revenue. Including the stablecoin business, the company hit $747 million in subscription related revenues, up $190 million YoY and up $90 million sequentially. The Q4 forecast was for subscription revenues of $710 to $790 million. The target is mostly inline with the $747 million produced in the prior quarter, though the original guidance was only $665 to $745 million , suggesting another beat at the top end amounts to over $790 million in Q4. The total stablecoin market is only $300 billion now and the initial estimates forecast a market reaching $3 to $4 trillion , or at least 10x the current size. Coinbase is poised to lead this market with access to the 2nd largest coin. Crypto transaction revenues will likely disappoint. Bitcoin dipped to $81K during November, typically leading to lower transaction volumes as evidenced by the reported crypto monthly exchange volumes. Source: The Block Remarkably Cheap The stock only trades at ~15 EV/FY26 adjusted EBITDA. A lot of investors view the stock as expensive due to trading at over 30x EPS targets while Coinbase has substantially larger adjusted EBITDA due to stock-based compensation. Source: Coinbase Q3'25 shareholder letter The current analyst estimates don't factor in any of these expansion products into any material growth. Coinbase is only forecast to grow revenues by a combined 25% over the next 2 years to reach just $9.3 billion in 2027. One would generally see the multi-trillion opportunity in stablecoins and blockchain rewards to provide this growth opportunity alone. Any rebound in crypto transactions and the new transaction markets of tokenized stock trading and prediction markets seems more like a huge bonus. The company remains loaded with cash and crypto assets, including $11.9 billion in USD resources and another $2.6 billion in long-term crypto assets. Coinbase has $7.2 billion in long-term debt for a new capital position of $7.3 billion. As discussed above, Coinbase faces low crypto transaction volumes during Q4. The consensus analyst estimates forecast revenues falling 17.3% to only $1.9 billion. The company has the potential for easy crypto comps in 2026 along with revenues from the new expansion products to provide material growth this year. On the flip side, a lot of these large fintechs like Coinbase, Robinhood and SoFi are starting to enter the same segments. The worse possible outcome is competition squeezing profit and cutting off growth. Takeaway The key investor takeaway is that Coinbase has too many shots on goal to ignore the stock here. Coinbase is too cheap to sell close to the yearly lows, especially before the product expansions in stablecoins, tokenized stock trading and prediction markets are just getting ramped up.
