Bernstein says it's 'still early' in the crypto bull cycle as Robinhood posts 'breakout' Q2 and Coinbase inks JPMorgan deal

The current crypto bull cycle is still in its early innings, according to analysts at research and brokerage firm Bernstein, with exchanges like Robinhood and Coinbase well-positioned to benefit from rising volumes and mainstream adoption.

Bernstein reaffirmed its "outperform" rating on both companies, signaling continued confidence in their performance despite having already witnessed significant rallies this year.

Robinhood's stock closed up 2.7% on Wednesday at $106.10, already surpassing Bernstein's most recent $105 price target, having gained over 175% year-to-date. Coinbase shares ended the session up 1.6% at $377.48, building on a 47% year-to-date gain, with 35% potential upside to hit Bernstein's current $510 target for the stock. That compares to a 27% rise for bitcoin and 15% for ether in 2025.

Robinhood posted a "breakout" second quarter on Wednesday, with revenues up 46% year-over-year and adjusted EBITDA margins climbing to 56%, the Bernstein analysts led by Gautam Chhugani wrote in a Thursday note to clients. Despite a sluggish crypto market in the second quarter — with Robinhood's crypto volumes down 39% compared to Q1 — its volumes were still up 32% year-over-year, Chhugani said.

Robinhood witnessed a sharp recovery in July, the analysts noted, surging to six-month highs, buoyed by renewed market volatility and growing investor interest in Ethereum, Solana, and DeFi tokens following Circle's blockbuster IPO and the narrative around stablecoins and tokenization, in their view. "H2 looks great for crypto volumes surging back," they said.

Additionally, Bernstein noted Robinhood’s ongoing expansion of its crypto product suite, pointing to the firm's recent Bitstamp integration, crypto and stock tokenization expansion in the EU, and new token listings. Robinhood's crypto take rate (the average revenue it earns per dollar traded on the platform) has risen to around 57bps — up nearly 20bps year-over-year — in a sign of pricing power amid slow-moving incumbents like Charles Schwab, the analysts said, with net deposits hitting $13 billion in the quarter and its Gold subscription products also gaining traction.

Coinbase's JPMorgan deal

In an earlier note on Wednesday, the Bernstein analysts also reflected on the announcement of Coinbase's strategic partnership with JPMorgan, marking a notable shift in the Wall Street giant's stance on digital assets.

Under the agreement, Chase customers will be able to link bank accounts directly to Coinbase, redeem reward points 1:1 for USDC on Base, and fund Coinbase wallets via Chase credit cards. Bernstein described the move as "a huge adoption unlock (given the banking choke points in the previous regime)," emphasizing the symbolic nature of JPMorgan embracing an industry its CEO, Jamie Dimon, has publicly criticized in the past, and further accelerating Coinbase's customer acquisition.

"We believe, leading U.S. banks see Coinbase as the leading blockchain financial infrastructure for accessing liquidity and enabling customer access," Chhugani wrote. "The Coinbase bear case around future competition from banks simply sees Coinbase as exchange/trading venue, but we believe, Coinbase is the central financial infra for banks such as JPM to plug into and partner."

The integration could accelerate mainstream usage of USDC as digital cash for savings and payments, he added, with the long-term potential to drive deeper interoperability between fiat and crypto systems.

"We believe we are still early in the crypto bull cycle," the Bernstein analysts wrote on Thursday, framing recent developments as validation of that outlook and concluding that, for now, there's "nothing to do here."

Chhugani maintains long positions in various cryptocurrencies. Certain affiliates of Bernstein act as market makers or liquidity providers in the equity securities of Robinhood and Coinbase.