Coinbase(US:COIN) The Motley Fool·2026-01-18 06:00Core Viewpoint - Coinbase offers a lower-risk investment opportunity to gain exposure to the long-term growth of cryptocurrencies, benefiting from institutional adoption and acting as a primary custodian for U.S. spot Bitcoin and Ethereum ETFs [1][2] Business Momentum - In Q3 of fiscal 2025, Coinbase reported revenues of $1.9 billion, a nearly 55% year-over-year increase, and adjusted EBITDA of $801 million, up 78.3% year-over-year [4] - Subscription and service revenues accounted for 40% of total revenues in Q3, indicating a shift away from volatile trading fees and more consistent earnings performance [4] Market Position and Regulatory Environment - The regulatory landscape for cryptocurrencies is improving, with U.S. lawmakers preparing for key hearings and votes in January 2026 to establish clearer regulations [2] - Coinbase is complying with the EU's Markets in Crypto-Assets (MiCA) framework by submitting required disclosures [2] Key Financial Metrics - Coinbase's market capitalization is $65 billion, with assets held on the platform nearing $516 billion, supported by growing institutional flows [6] - The gross margin stands at 86.71%, indicating strong profitability [6] Growth Catalysts - Stablecoins are a significant growth driver, with Coinbase generating $355 million in stablecoin-related revenues, bolstered by high interest rates and a $15 billion USDC balance on the platform [7] - The increasing use of USDC for payments and cash management is leading to higher interest-based revenues for Coinbase [7] Investment Outlook - Despite exposure to cryptocurrency volatility, Coinbase is positioned as a smart investment choice to benefit from long-term trends in cryptocurrency adoption [8]