Wall Street bank Citigroup is cutting its forecast for Coinbase (COIN) as risk aversion grips the market.
In a note to clients on Friday, analysts at the bank lowered their price target on the cryptocurrency exchange to $400 from $505, citing weak trading volumes, weak institutional activity and continued uncertainty over the timing of U.S. cryptocurrency legislation.
The new $400 price target is still more than double COIN’s closing price of $146 last night. The analyst team raised COIN’s price target to $505 in July 2025, when the stock hit an all-time high of nearly $450.
Shares were up 6% in pre-market trading on Friday as the cryptocurrency market recovered slightly from Thursday’s collapse that saw Bitcoin plunge to $60,000.
Despite the recent reset, the firm reiterated its Buy/High Risk rating, calling Coinbase the leader in the category and a major beneficiary of eventual cryptocurrency reform. Citi said progress on CLARITY remains a key catalyst to revive momentum in the stock.
The bank currently expects Senate negotiations on the market structure bill to continue beyond 2026, although groundwork continues.
Coinbase CEO Brian Armstrong said the company has withdrawn support for a comprehensive digital assets bill after finding provisions that could harm consumers and stifle competition.
The bill has repeatedly lost momentum as cryptocurrency and bank lobbyists clash over stablecoin yields, while lawmakers from both parties remain deadlocked on several other provisions.
Analysts led by Peter Christiansen have lowered their near-term forecasts based on current cryptocurrency prices, cutting Coinbase’s fourth-quarter 2025 net revenue by about 10% to $1.69 billion, about 4% lower than market expectations.
After factoring in a $2.3 billion mark-to-market decline in cryptocurrency holdings and Coinbase’s stake in Circle (CRCL), analysts now forecast a fourth-quarter GAAP EPS loss of $2.64.
Coinbase will release its fourth quarter and full-year 2025 financial results on February 12 after the market closes.
Read more: Citi says CLARITY Act is gaining momentum, but DeFi fight could hinder cryptocurrency bill
