TLDR
- Bank of America upgraded Coinbase stock to a buy rating after a sharp decline in price.
- The bank set a new price target of $340, suggesting a 38 percent upside from current levels.
- Analysts said Coinbase shares have become cheaper and short interest has doubled over the past year.
- BofA stated that tax-loss selling pressure from late 2025 is starting to ease.
- Coinbase plans to expand into stock and ETF trading alongside crypto offerings.
Bank of America upgraded Coinbase stock to a “buy” rating after a recent sharp drop in share price, citing undervaluation, strong product momentum, and early-stage crypto adoption. The bank set a $340 price target, implying 38% upside from current levels near $245, while it emphasized Coinbase’s expanding market presence. Analysts highlighted improving sentiment, reduced selling pressure, and increased infrastructure investment as key factors behind the rating change.
Bank of America raised its price target for Coinbase to $340, citing a 40% pullback from July highs around $420. Analysts believe the recent drop presents a more attractive entry point given Coinbase’s ongoing growth in new markets.
The bank stated that “tax-loss selling pressure from late 2025 appears to be fading,” removing a major drag on the stock. This comes as Coinbase boosts product development and broadens its service offerings across both retail and institutional segments.
Short interest in Coinbase shares has roughly doubled year-over-year, which BofA said could intensify gains if investor sentiment improves. The analysts noted that the stock has become “significantly cheaper” despite long-term expansion potential remaining intact.
Coinbase Product Expansion Gains Momentum
BofA credited Coinbase’s December product showcase for revealing its long-term strategic roadmap across new asset classes and infrastructure. The exchange plans to introduce trading for stocks and ETFs alongside crypto, and launch prediction markets.
Coinbase also aims to roll out equity-linked perpetuals outside the U.S., diversifying revenue sources and reducing dependence on volatile retail volumes. These new offerings support the view that the company is preparing for a broader financial services role.
The analysts also identified derivatives, stablecoins, and institutional infrastructure as future revenue streams that could help offset retail weakness. These efforts come as Coinbase pushes to capture more institutional and global user demand.
Base and Tokenize Positioned as Long-Term Growth Drivers
Bank of America emphasized that Coinbase’s Layer 2 network, Base, is central to its infrastructure ambitions and long-term monetization strategy. As onchain activity expands, the bank expects Base to play a growing role in revenue generation.
Coinbase’s recently launched Tokenize platform may also allow the firm to benefit if real-world assets move onchain at scale. BofA believes this positions the company to serve asset managers exploring tokenization.
Analysts noted that these initiatives align with the view that crypto adoption is still in the “early innings.” Coinbase’s broader ecosystem investments support its evolution beyond a spot trading platform.
Goldman Sachs also upgraded Coinbase to a “buy” rating, though it warned of execution risk and ongoing margin pressure in 2026. William Blair maintained its “outperform” rating, citing long-term growth beyond spot trading.
BofA’s upgrade adds to a series of bullish analyst revisions, reflecting growing confidence in Coinbase’s diversified strategy. The stock closed at approximately $245 at the time of the report.
Get 3 Free Stock Ebooks
Discover top-performing stocks in AI, Crypto, and Technology with expert analysis.
- Top 10 AI Stocks - Leading AI companies
- Top 10 Crypto Stocks - Blockchain leaders
- Top 10 Tech Stocks - Tech giants
