Crypto Exchange Coinbase (Coin) goes beyond its role as a USDC distributor and has established itself as a key driver for Stablecoin adoption across payments and financial services, Wall Street broker Bernstein said in a research report Wednesday.
The company recently launched Coinbase Payments, built in collaboration with Stripe and Shopify, introducing the Coinbase business, targeting startups and small businesses. Both services use Circle's USDC Stablecoin.
In derivatives, Coinbase uses Nodal Clearto USDC as collateral for the US futures market.
Crypto Exchange's basic blockchain hosts over $3.7 billion in USDC and processes USDC-related payment volumes of $68 trillion per year, writes an analyst at Bernstein, led by Gautam Chugani.
Coinbase owns a direct share interest in Circle (CRCL), the issuer of USDC, and also has a revenue sharing agreement for Stablecoin.
“Under the new revenue sharing agreement, Coinbase received 100% of its interest income from USDCs held directly on its platform, and for USDC, off-platform, Coinbase and Circle split the revenues at 50:50,” Chhugani said.
Stablecoins are cryptocurrencies that have value in other assets, such as US dollars and gold. They play a major role in the cryptocurrency market and are also used to transfer money internationally.
Stablecoin's revenues have become a major contributor to Coinbase's revenues, Chhugani continued. Non-trade revenues rose from $181 million in 2020 to $2.8 billion in 2024, and now account for 42% of total revenue.
The Shift highlights the incentive to expand USDC utility across Coinbase payments and distributed finance (DEFI), pinning it as a long-term growth engine beyond trading, the report added.
Bernstein has outperform ratings on both Coinbase and Circle, with price targets of $510 and $230 respectively.
read more: Coinbase is the most misunderstood business in Crypto, says the analyst with the highest priced Wall Street
