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Following Bybit Research’s coverage of CRCL shares, attention now shifts to another standout in the US crypto equity space—Coinbase (NASDAQ: COIN). With a year-to-date return of 42%, COIN has not only outpaced major market indices but has also significantly outperformed Bitcoin’s 13.5% gain over the same period.
Trade with Bybit on the movements of COIN.
As of the time of writing, Coinbase (NASDAQ: COIN) is trading at a forward price-to-earnings (P/E) ratio of 61.55 and a price-to-sales (P/S) ratio of 14.11 — figures that place it well above the average valuation metrics of traditional equities. For context, the Nasdaq Composite Index’s average forward P/E ratio hovers around 39.95, underscoring just how premium Coinbase’s valuation truly is.
This elevated multiple reflects investor optimism around Coinbase’s dominant position in the crypto ecosystem, its exposure to high-growth verticals like stablecoins and derivatives and its expanding global footprint. But lofty valuations come with expectations: expectations of sustained revenue growth, margin expansion and continued regulatory tailwinds.
And here’s where the conversation shifts.
Yes, Wall Street widely acknowledges COIN’s rich valuation. But the more pressing question is this: are there further growth and is now the right time to buy?
That’s a different story — one that hinges on your investment horizon and risk appetite. If you believe in the long-term institutionalization of crypto, the rise of stablecoin-based payments and Coinbase’s ability to monetize its ecosystem beyond trading fees, then today’s price may be a premium worth paying. However, if you’re looking for value based on traditional metrics, COIN might appear stretched.
COIN has consistently shown a strong positive correlation with Bitcoin’s price, typically moving in tandem with the broader cryptocurrency market. Historically, COIN has tended to lag behind Bitcoin’s price action, reacting to major moves, rather than leading them.
This correlation is rooted in Coinbase’s business model: trading volumes, custody services and institutional flows all scale with crypto market sentiment. As such, betting against COIN during a crypto bull run is often a losing proposition, as the company’s revenues and investor sentiment are tightly intertwined with the momentum of digital assets.
A shift in leadership: COIN takes the driver’s seat
What’s particularly noteworthy in the current cycle is that Coinbase has begun to outperform Bitcoin, a reversal of the usual dynamic. Since mid-June 2025, COIN has led Bitcoin in terms of price appreciation, signaling a shift in investor focus from the underlying asset to the infrastructure enabling its adoption.
This leadership reversal coincides with the blockbuster IPO of Circle Internet Group, Inc. (CRCL), the issuer of USDC. CRCL’s stock surged over 700% within weeks of its debut, drawing considerable attention to the stablecoin sector and its key stakeholders. Coinbase, which co-founded USDC and maintains a 50% profit-sharing agreement with Circle, has been a direct beneficiary of this surge.
Investors are increasingly recognizing that Coinbase captures more economic value from USDC than Circle does, thanks to its share of interest income and its dominant role in USDC distribution. While Circle bears the operational costs of issuance and compliance, Coinbase enjoys a capital-light revenue stream from USDC reserves and platform-held balances.
As CRCL’s valuation ballooned to over $60 billion, many market participants began to reassess Coinbase’s relative worth. The logic is simple: if Circle is worth over $60 billion, based on its USDC exposure, then Coinbase — arguably the more profitable and diversified partner —deserves a valuation premium. This sentiment has fueled a re-rating of COIN, pushing it to outperform Bitcoin and other crypto equities in recent weeks.
As Bybit highlights in its latest report, the regulatory landscape for crypto in the US is undergoing a significant transformation. Beyond the landmark GENIUS Act, which would establish a federal framework for stablecoins, additional legislation, such as the BITCOIN Act, is gaining traction in Congress. Together, these initiatives signal a broader shift toward regulatory clarity and institutional acceptance — conditions that could entice a new wave of investors to enter the digital asset space with greater confidence.
Regulatory tailwinds are fueling market optimism
The GENIUS Act lays the groundwork for stablecoin oversight, while the BITCOIN Act proposes the creation of a strategic Bitcoin reserve, a bold move that underscores the US government's growing interest in digital assets as part of its financial infrastructure. These developments aren’t just symbolic; they represent a paradigm shift in the way crypto is perceived by policymakers, potentially unlocking billions of dollars in institutional capital.
Coinbase derivatives: A strategic breakthrough
Amid this regulatory momentum, Coinbase Derivatives LLC has seized the opportunity to launch US-regulated, perpetual-style futures for Bitcoin and Ethereum, set to go live on Jul 21, 2025. This is a watershed moment. For years, Coinbase was constrained by a hostile regulatory environment that prevented it from offering the same leveraged trading tools available on offshore platforms, such as Binance and Bybit. Perpetual futures — contracts without expiration dates — account for over 90% of global crypto derivatives volume, making them a critical revenue driver in the industry.
Now, with CFTC-compliant perpetual futures, Coinbase can finally tap into this lucrative market. These contracts offer 24/7 trading, hourly funding rates and five-year durations, providing both retail and institutional traders with a capital-efficient alternative to traditional futures.
The introduction of perpetuals is expected to boost Coinbase’s trading volumes and fee income, particularly as US traders migrate from offshore venues to a regulated domestic platform. With trading fees still comprising the bulk of Coinbase’s revenue, this product expansion could materially enhance its top line — especially in a bullish market environment.
From a traditional finance perspective, COIN appears richly valued, with valuation multiples that far exceed those of conventional fintech or tech peers. But framing COIN as just another fintech stock misses the bigger picture: Coinbase isn’t merely a trading platform. Rather, it’s a cornerstone of the blockchain economy — and one of the few publicly traded vehicles offering direct exposure to the infrastructure powering digital assets.
Given Coinbase’s deep ties to the crypto ecosystem, heightened volatility is par for the course. COIN’s price action often mirrors the sentiment swings of the broader digital asset market, amplified by regulatory headlines, macroeconomic shifts and Bitcoin’s own momentum. This makes it unsuitable for short-term investors seeking stability — but also potentially rewarding for those with a longer horizon and higher risk tolerance.
Coinbase’s performance is inextricably linked to the evolution of crypto policy in the United States. As a US-focused exchange, its fortunes rise and fall with domestic regulatory clarity. Fortunately, 2025 has ushered in a more constructive environment: the dismissal of the SEC’s lawsuit, bipartisan support for crypto legislation and the passage of the GENIUS and BITCOIN Acts have all contributed to a more favorable operating climate.
Within this context, investors can shift their focus from traditional valuation metrics to top-line growth potential. Coinbase is expanding its revenue base through the following channels:
Perpetual futures trading, now approved for US customers
Stablecoin monetization, via Coinbase’s 50% profit share from USDC
Subscription services, including Coinbase One and staking
International expansion, with MiCA licensing in the EU and new markets in Asia and Latin America (LATAM)
These growth vectors are being unlocked precisely because of the regulatory tailwinds now blowing in Coinbase’s favor.