Coinbase's 30% Drop Defies Worry — Analysts See 2027 Rebound
By John Nada·Jul 16, 2026·4 min read
Coinbase's stock fell 30% in 2026, but analysts like William Blair see recovery by 2027 despite slashed revenue forecasts.
Coinbase's stock has plunged nearly 30% this year, but analysts aren't sounding the alarm just yet. William Blair, a notable Chicago-based investment bank, slashed its revenue and earnings forecasts for the crypto exchange, yet maintained an 'outperform' rating. The bank argues that the current pain is already priced in, suggesting that the worst might be over for Coinbase.
Founded in 1935, William Blair is known for its tech and growth coverage, and its latest note has captured significant attention. The firm cut its 2026 revenue estimates for Coinbase by 12% and 2027 estimates by 13%, while also gutting adjusted EBITDA projections by 34% in both years. Despite these reductions, the firm maintains that earnings should trough by the end of the year and sees a potential rebound in 2027. This perspective is rooted in the belief that key risks are already reflected in the stock price, underscoring a potential upside linked to a Bitcoin recovery.
Analysts Andrew Jeffrey and Adib Choudhury from William Blair have projected a bleak 2026, with a sharp reduction in revenue estimates. However, they forecast a recovery in 2027, asserting that crypto volume will bottom out alongside Bitcoin. They perceive the current cycle as distinct from past ones, citing new developments such as the emergence of spot Bitcoin ETFs, increased institutional flows, and a matured regulatory landscape.
Coinbase and Circle shares rose around 3-4% after this announcement, reflecting investor optimism about future prospects despite the current downturn. William Blair expects Coinbase's total trading volume to fall roughly 44% this year to $669 billion but forecasts a more than 32% rebound by 2027. This optimistic outlook is partly due to Coinbase's Base layer-2 network, which is highlighted as a significant future earnings driver. The network is expected to expand revenue streams beyond just spot trading, with retail derivatives and prediction markets contributing substantially.
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Not all analysts share William Blair's optimism. Patrick Moley from Piper Sandler reduced his price target for Coinbase from $170 to $155, maintaining a 'neutral' stance. He highlighted concerns about prediction markets and perpetual futures, particularly after the World Cup spurred massive activity in these areas. Moley warned of significant investor attention on the perpetual future threat as we move into the third quarter, indicating a cautious approach to the market's current state.
Technical analysis also plays a crucial role in the current market dynamics. John Bollinger, the creator of the Bollinger Bands, has identified a 'W' double-bottom pattern on Bitcoin's daily chart. This pattern is often seen as a potential trend reversal, suggesting the possibility of a bullish shift if Bitcoin surpasses certain resistance levels. Bollinger's long Bitcoin position aligns with his analysis, which indicates weakening bearish trends. He describes the setup as 'perfectly fractal,' highlighting smaller versions of the same shape nested within the larger structure, visible even on the weekly chart.
The broader market context cannot be ignored. Glassnode, a blockchain analytics firm, reports a decline in long-term holder capitulation, which has been a major source of selling pressure throughout the year. The firm observed a wave of Bitcoin accumulation during June, with the digital currency's sensitivity to macroeconomic news, such as inflation data, reemerging. However, significant spot-driven buying has yet to solidify the recovery, and the capital hasn't fully arrived.
William Blair's projections for a 2027 rebound are underpinned by the expectation of a 32% rebound in Coinbase trading volume after this year's expected 44% decline. This aligns with the broader market trends, where derivatives positions are unwinding, long-term sellers are thinning, and the fear premium in the options market is easing. The landscape remains challenging, with investors navigating a complex mix of optimism and caution as we edge closer to 2027.
The unfolding dynamics present a mosaic of factors influencing Coinbase's trajectory. While some remain wary of the challenges, the potential for recovery in 2027 offers a glimmer of hope. The intersection of technical analysis, market trends, and regulatory developments will continue to shape the narrative around Coinbase and the broader cryptocurrency market.