Potential Bottom for Crypto Stocks, Bernstein Analysts Suggest
Current market trends indicate that cryptocurrencies and related stocks might be approaching a significant low point, according to analysts at Bernstein. In a recent report, Gautam Chhugani and his team highlighted a combination of geopolitical factors and a temporary downturn in crypto sentiment, which they believe is presenting substantial discounts on crypto stocks.
Notable trading platforms like Coinbase (COIN), Robinhood (HOOD), and fintech firm Figure Technology Solutions (FIGR) have seen their shares decline by approximately 60% from previous all-time highs. Meanwhile, Bitcoin’s price has decreased from over $120,000 last year to just below $68,000 at present.
Despite these setbacks, Bernstein maintains an Outperform rating for these three stocks but has adjusted its price targets in anticipation of weak earnings results for the first quarter of 2026. Chhugani expressed optimism, stating, "We believe we will see a bottom in crypto stocks into weak Q1 earnings." For longer-term prospects, the analysts project that Coinbase’s earnings per share could climb by 23% by 2026.
The analysts particularly note resilience among Robinhood and Figure, attributing it to their revenue structures. With crypto revenue making up about 20% of Robinhood’s sales, its financial health appears less vulnerable to fluctuations in the cryptocurrency market. On the other hand, Figure is dedicated to blockchain tokenisation, which further insulates it from the volatility typically seen in cryptocurrencies.
Chhugani emphasised the potential these companies hold, stating they offer "exposure to trillion-dollar markets" with considerable growth potential, which includes prediction markets, stablecoins, tokenised assets, and crypto derivatives. Bernstein projects that by the end of 2026, Bitcoin could rebound to a price of $150,000.
Interestingly, Bitcoin exchange-traded funds (ETFs) have recently reversed outflows, now representing approximately 6.1% of total supply. Additionally, Strategy (MSTR), a significant player in the digital asset space, remains an active buyer, currently holding around 3.6% of the total Bitcoin supply.
Despite Bitcoin’s relatively strong performance during periods of geopolitical tension, there is skepticism among some financial experts. Lee Munson, Chief Investment Officer at Portfolio Wealth Advisors, remarked, "This is just a risk asset like everything else." He cautioned that in the event of a broader market downturn due to rising oil prices, the notion that any segment of the market would remain insulated is misguided.
As the market awaits economic developments, analysts and investors will be closely monitoring earnings results and broader market indicators to gauge future performance in the cryptocurrency sector.
Conclusion
As Bernstein analysts suggest, while crypto stocks could be nearing a pivotal bottom amid significant discounts, the path to recovery might hinge on upcoming earnings and macroeconomic conditions. The interplay between geopolitical events and market sentiment will be crucial as investors navigate these turbulent waters.
