Analysts See Billions in New Revenue from Base Token and USDC Overhaul
Shares of Coinbase Global Inc. (COIN) surged on Friday after JPMorgan Chase upgraded the cryptocurrency exchange’s stock, citing new monetization opportunities tied to its Base layer-2 network and USDC rewards restructuring.
The investment bank raised its rating from “Neutral” to “Overweight” and lifted its price target to $404 per share, signaling about 15% upside from current levels. The bullish outlook triggered a 9% rally in Coinbase’s stock to roughly $353, pushing its market capitalization to nearly $90.6 billion.
Base Network Seen as Billion-Dollar Catalyst
JPMorgan’s analysts highlighted Coinbase’s growing focus on unlocking value from its Base blockchain, a layer-2 scaling solution built on Ethereum. The bank estimated that the launch of a Base token could open a $12 billion–$34 billion market opportunity, with Coinbase potentially retaining $4 billion–$12 billion of that value.
Analysts expect the Base token distribution to favor developers, validators, and community members, mirroring decentralized incentive structures seen in other major blockchain ecosystems.
“Coinbase is leaning into its Base ecosystem as a driver of long-term growth,” the JPMorgan note stated.
USDC Rewards Overhaul to Boost Margins
The report also pointed to potential margin expansion from Coinbase’s upcoming USDC rewards program changes.
JPMorgan said Coinbase may limit interest rewards to Coinbase One subscribers, reducing payouts for general users while maintaining loyalty benefits for premium members.
This shift could generate an additional $374 million in annual earnings based on current USDC yields and interest rates, the bank projected.
“A more efficient capital structure around USDC could significantly improve profitability without sacrificing user engagement,” analysts added.
Earnings Outlook: Strong Growth Ahead
Coinbase will report third-quarter earnings on Oct. 30, with Wall Street expecting a sharp improvement from last year.
According to Zacks Investment Research, consensus estimates call for earnings of $1.06 per share, up 71% year-over-year, and revenue of $1.74 billion, representing 44% annual growth.
The upcoming results follow a mixed second quarter, when Coinbase narrowly missed earnings targets but achieved solid operational progress — including rising stablecoin balances and higher subscription revenue.
The company’s subscription and services business is projected to contribute $665 million–$745 million in Q3, underscoring Coinbase’s pivot toward recurring income streams.
Recent regulatory developments have also strengthened Coinbase’s outlook. The company welcomed the approval of the GENIUS Act, which provides a clear legal framework for U.S. stablecoin adoption, and the House’s passage of a broader crypto market structure bill, seen as a major step toward regulatory clarity for the industry.
With strong fundamentals, expanding products, and growing institutional adoption, Coinbase’s strategic focus on Base and USDC could redefine its profitability trajectory heading into 2025.
Disclaimer
This content is for informational purposes only and does not constitute financial, investment, or legal advice. Cryptocurrency trading involves risk and may result in financial loss.