Crypto trading activity has seen a significant slowdown in early 2026, prompting Wall Street analysts to swiftly adjust their forecasts ahead of the first-quarter earnings reports. Recent analyses from Barclays and Oppenheimer illustrate a consensus among multiple analysts regarding the declining expectations across the sector as trading volumes wane compared to earlier, more optimistic predictions.
Barclays recently downgraded Coinbase (COIN), stating that “global crypto trading activity has declined to a level not seen since the end of 2023.” The bank’s analysis shows that Coinbase’s trading volume for March reached its lowest level since September 2024, with no signs of improvement in April. The analysis estimates that transaction volumes dropped approximately 30% from the previous quarter, a notable decline that will directly impact Coinbase’s revenue since exchanges typically generate income through transaction fees for trades conducted on their platforms.
The rationale for this downturn is clear: when markets grow quiet, many traders retreat from active trading. Retail investors, who may have traded frequently during market rallies, can halt their trading altogether when price movements stabilize. This behavioral shift, amplified across millions of accounts, leads to a rapid decline in exchange volumes, significantly affecting revenue streams.
Barclays’ forecast indicates that Coinbase’s adjusted EBITDA could be approximately 24% below current market expectations, primarily due to diminished spot trading and retail activities. During the first quarter, the overall market saw declines in major cryptocurrency prices, with Bitcoin losing more than 22% and ether dropping 29% compared to the previous quarter.
Oppenheimer echoed these sentiments but maintained a slightly more optimistic perspective regarding Coinbase. The firm adjusted its forecasts to account for reduced crypto prices and lower trading volumes, attributing these trends to broader economic uncertainty as well. Oppenheimer noted that existing Wall Street estimates are lagging and do not fully capture the recent drop in trading activity, prompting a necessary correction.
The firm lowered its volume estimate for Coinbase to $211 billion, down from $244 billion, and now anticipates total revenue to be around $1.48 billion, which is below earlier forecasts and consensus figures. However, the downturn is not confined to Coinbase alone. Oppenheimer recognized that Circle (CRCL) has expanded its USDC stablecoin network, with slight increases in both market capitalization and transfer volume, while crypto platform Bullish (BLSH), owner of CoinDesk, recorded some strong platform activity in February linked to market volatility, despite falling short of volume expectations. Consequently, Rosenblatt recently downgraded BLSH, and Compass Point downgraded CRCL to “neutral” and “sell,” respectively.
While there are pockets of strength within the space, they underline a larger trend: the core business of crypto trading is slowing. Companies are pushing towards diversifying revenue streams, but these new efforts may take time to yield results. Coinbase is positioning itself as an “everything exchange,” exploring derivatives, tokenized assets, and new markets. However, Barclays expressed skepticism about this strategy, predicting that it will take significant time to pay off and highlighting a lack of market advantage in new asset classes such as equities.
Stablecoins are also facing an uncertain future as regulatory discussions in Washington continue to unfold, leaving questions about the status of stablecoin rewards. Meanwhile, Oppenheimer remains hopeful about new use cases providing near-term support for USDC growth, particularly as prediction market activity increases.
As the earnings season approaches, analysts appear to be proactively lowering estimates, opting to adjust their forecasts now rather than be caught off guard by potentially weak results later. Coinbase is scheduled to report its second-quarter earnings on May 7, while Bullish will detail its results on April 23. Circle has yet to announce its earnings date.
