William Blair argues that the recent downturn in crypto markets has opened a compelling buying opportunity for both Coinbase and Circle, saying the core investment cases for bitcoin and USDC remain firmly intact despite sharp price swings.
In a report published Monday, the bank said Coinbase’s (COIN) latest pullback represents a temporary “air pocket” rather than a sign of weakening fundamentals. William Blair reaffirmed its outperform rating, urging investors to take advantage of the dip. Coinbase shares traded 2.6% higher early Monday at $246.53.
Circle (CRCL) received the same endorsement. Even though the stock is down nearly 80% from its 52-week high, USDC’s market cap has held steady, reinforcing the bank’s view that the sell-off is disconnected from the stablecoin’s underlying strength. Because both companies are closely linked to USDC, William Blair expects their equities to move in tandem — positioning Coinbase as the broader crypto access point and Circle as the purer USDC growth play, particularly in cross-border B2B payments.
Analysts Andrew Jeffrey and Adib Choudhury said bitcoin’s decline doesn’t change their long-term thesis. Instead, they attribute the turbulence to market immaturity, noting that concentrated holdings and a surge in first-time ETF participation can amplify volatility. As liquidity deepens and regulatory frameworks mature, they expect bitcoin to stabilize and play a more structured role in traditional portfolios.
In the near term, softer trading activity may weigh on Coinbase’s transaction revenue, but the firm continues to gain share in U.S. spot markets while expanding its international derivatives franchise — moves that diversify revenue and soften volume-driven swings. With about a third of its expenses tied to activity levels, Coinbase also has flexibility to manage margins while advancing its platform strategy.
The report also underscored the resilience of Coinbase’s Subscription & Services business, which now contributes roughly 40% of company revenue. USDC’s steady $74 billion market cap is supporting S&S performance, and the bank remains confident in its $777 million fourth-quarter forecast. Staking revenue is also expected to benefit from higher yields and reduced redemptions during periods of market stress.
