Goldman Sachs Upgrades Coinbase, Citing Strategic Shift Beyond Crypto

A significant vote of confidence from Wall Street is bolstering Coinbase Global, Inc. as the company executes a strategic pivot. Goldman Sachs has upgraded its rating on the cryptocurrency exchange, pointing to its evolving business model and a deliberate expansion of its financial ecosystem.

In a notable shift, Goldman Sachs analyst James Yaro moved his firm’s rating on Coinbase shares from "Neutral" to "Buy." Concurrently, the investment bank raised its 12-month price target from $294 to $303. This new target implies a potential upside of nearly 30% from recent trading levels.

The upgrade is grounded in several structural improvements observed at the company:
* Diversified Revenue Streams: Revenue from subscriptions and services now constitutes approximately 40% of total sales, a dramatic increase from less than 5% in 2020. This shift reduces the firm's reliance on volatile trading volumes.
* Superior Growth Trajectory: Goldman Sachs projects Coinbase will achieve an average annual revenue growth (CAGR) of 12% through 2027, outpacing the estimated 8% growth of its peers.
* Product Expansion: New initiatives in brokerage, banking, asset management, and tokenization are expected to fortify its competitive standing.

Yaro highlighted Coinbase's brand strength and scale as drivers for above-average revenue growth and market share gains, achieved with relatively low customer acquisition costs. The subscription and service segment, in particular, is forecast to grow 13% annually from 2025 to 2027, helping to stabilize earnings as cryptocurrency use cases expand beyond mere trading.

In a contrasting move, Goldman Sachs downgraded competitor eToro from "Buy" to "Neutral," slashing its price target from $48 to $39. The downgrade cited intensified competition and rising costs associated with acquiring new customers.

Stock Performance and Technical Context

Coinbase shares recently closed at $254.92. While this price remains about 29% below its 52-week high, it sits well above the low seen over the past twelve months. The stock has registered a double-digit percentage gain on a weekly basis, reinforcing a recovery following a one-year decline of roughly 8%.

From a technical analysis perspective, the stock appears overbought in the short term, with its Relative Strength Index (RSI) above 70. However, trading firmly above the 50-day moving average suggests the market is increasingly pricing in renewed optimism. This marks a change after Coinbase underperformed the broader U.S. market for much of the past year.

Building the "Everything Exchange"

Management's forward-looking strategy is providing additional momentum. CEO Brian Armstrong publicly promoted on January 6 the ability to trade Coinbase shares directly on its own platform. With the launch of stock trading for U.S. customers, the company is now competing directly with established neo-brokers like Robinhood.

Should investors sell immediately? Or is it worth buying Coinbase?

Armstrong's vision is for users to trade "everything in one place"—spanning millions of crypto assets, equities, prediction markets, and perpetual futures. This core ecosystem is being augmented with services including lending, credit cards, and instant global money transfers.

A key component of this strategy was the acquisition of The Clearing Company in December 2025. This move accelerates Coinbase's development of prediction markets, a segment that aligns with its vision of a platform for all digital assets and financial products. It also opens avenues for new fee-based revenue streams distinct from traditional crypto trading.

Strategic Pullback in Argentina

Even as it pursues global expansion, Coinbase is applying strategic brakes in certain markets. The company announced on Sunday that it will suspend peso-based services in Argentina effective January 31, 2026. After this date, users will no longer be able to buy or sell the USDC stablecoin with Argentine pesos or cash out pesos to local bank accounts.

The company describes this as a "conscious pause" rather than a full exit. Its intention is to refine its offering and return at a later date with a stronger product. Importantly, crypto-to-crypto trading will remain available for Argentine customers.

This adjustment comes less than a year after receiving formal market entry approval from the national securities regulator, CNV. At the time of entry, Coinbase had highlighted Argentina's potential as a market with several million daily crypto users. The recent decision indicates a management team willing to selectively calibrate its expansion rather than persist with early-stage market experiments at any cost.

Outlook: Balancing Opportunity and Risk in 2026

Goldman Sachs views 2026 as a pivotal year for Coinbase, presenting a mix of high-potential opportunities and clear risks. On one side are significant prospects driven by tokenization, prediction markets, and a broadening product suite. On the other are challenges including heightened competition, interest rate sensitivity, and ongoing regulatory uncertainty.

The current analyst consensus leans toward optimism. Of 39 published recommendations, 64% rate the stock a "Buy," 31% advise "Hold," and only 5% recommend "Sell." The upcoming quarterly report will be crucial in demonstrating whether growth in subscriptions and services is as robust as Goldman Sachs and other bullish analysts anticipate.

The broader cryptocurrency market provides a supportive backdrop. Bitcoin has entered 2026 strongly, with prices above $94,000, creating a positive environment for Coinbase's core trading business. Simultaneously, the company's push into traditional financial products and novel digital markets positions it to sustain growth even if pure crypto market enthusiasm experiences temporary lulls.