Goldman Sachs recommends buying Coinbase: optimistic about new product expansion, but competition and regulatory variables suppress profits

Goldman Sachs (Goldman Sachs) announced in its latest 2026 Industry Outlook report that it has upgraded cryptocurrency exchange Coinbase from “Neutral” to “Buy.” Goldman Sachs believes that Coinbase has actively expanded its non-trading revenue streams and launched diversified new products in recent years, making the company’s long-term growth profile more complete. However, Goldman Sachs is cautious about rising industry competition and the potential environment of future rate cuts, which may still pressure short-term profit margins. Overall, the outlook is “selectively optimistic” rather than fully optimistic.

Background of the rating upgrade: revenue structure transformation becomes key

Goldman Sachs has upgraded Coinbase’s investment recommendation from “Neutral” to “Buy” because Coinbase has continuously expanded its non-trading revenue sources, including custodial, staking, and subscription-based infrastructure services, reducing the company’s dependence on cryptocurrency market volatility.

Goldman Sachs estimates that such “structural” businesses now account for about 40% of total revenue, a significant increase from less than 5% five years ago. Goldman Sachs believes that these income streams are relatively less volatile and can provide a buffer during market fluctuations.

[Image: Goldman Sachs 2026 Outlook report, evaluating Coinbase with a target price of up to $303, but overall outlook remains cautious]

At the same time, Goldman Sachs has set Coinbase’s target price for the next 12 months at $303, implying approximately 34% upside from the recent stock price of around $225.

However, Goldman Sachs emphasizes that this does not mean a full bullish stance on the entire crypto industry. With increasing competition and higher sensitivity to interest rates, adjusted EBITDA profit margins in 2026 may not see significant expansion. The overall stance remains “selectively optimistic.”

(Note: Adjusted EBITDA profit margin refers to the proportion of core operating profit to revenue after excluding interest, taxes, depreciation, amortization, and certain one-time or non-core items, used to measure the company’s core profitability and economies of scale.)

Deepening new product deployment, with market and tokenization potential forecast

Goldman Sachs points out that a series of new trading products announced by Coinbase in December last year, including US stocks, prediction markets, derivatives, and expanded banking services, are among the key factors for the upgrade.

Among these, prediction markets and asset tokenization are seen as areas with long-term potential, but whether they can successfully convert into substantial revenue still depends on liquidity and platform scale. In this regard, Goldman Sachs believes Coinbase has an advantage due to its existing user base and platform strengths, giving it relatively favorable conditions in competition.

At the same time, Goldman Sachs highlights regulation as the biggest variable. Future valuation upside will heavily depend on whether the US Congress passes legislation related to the structure of the crypto market.

Competition and regulatory variables put short-term profit margins under pressure for Coinbase

Despite increased options for long-term growth, Goldman Sachs remains cautious about Coinbase’s short-term profitability. The reason is that traditional brokerages continue to expand their crypto-related services, while native crypto firms are also entering stocks, banking, and payments sectors, creating bidirectional competition and raising customer acquisition costs across the industry.

In this context, Goldman Sachs expects Coinbase’s profit margins to remain under pressure in the short term. It also explicitly points out regulatory risks, stating that the company’s long-term valuation upside will heavily depend on whether the US Congress can successfully push forward legislation related to the crypto market structure. Regulatory progress remains a key variable influencing future development.

[Image: Price change chart for COIN 2025 – 2026]

(Coinbase Outlook 2026: On-chain derivatives trading volume rebounds, perpetual stock contracts become the next focus)

This article: Goldman Sachs recommends buying Coinbase: optimistic about new product deployment, but competition and regulatory variables suppress profits was first published on Chain News ABMedia.