Coinbase stock is encountering significant headwinds as the competitive landscape for cryptocurrency trading in the United States undergoes a seismic shift. The looming entry of financial behemoth Charles Schwab, coupled with a deteriorating technical outlook, is raising critical questions about COIN’s near-term price stability and market share defense.
This confluence of fundamental competition and bearish chart patterns suggests the stock may be at risk of a deeper correction, with a key technical target now set at $200.
The Competitive Storm: Schwab and SoFi Enter the Fray
The core bull case for Coinbase—its dominance as a U.S.-regulated, user-friendly on-ramp—is being directly challenged.
-
Charles Schwab’s Imminent Launch: The brokerage giant, overseeing nearly $12 trillion in assets, plans to launch crypto trading for its 38 million+ clients in January 2025. Starting with Bitcoin and Ethereum, this move places a trusted, mainstream financial brand directly in Coinbase’s core market.
-
SoFi’s Relaunch: The recent re-entry of SoFi, with its base of over 12 million customers, further fragments the market, offering users a consolidated platform for both traditional and crypto finance.
-
The Regulatory Thaw: A more favorable regulatory environment under the current administration is also paving the way for global exchanges like OKX and Binance to potentially re-enter or expand in the U.S., adding another layer of long-term competitive pressure.
The Financial Squeeze: Slowing Growth and Margin Compression
This competitive onslaught threatens Coinbase’s financial metrics at a precarious time:
-
Slowing Revenue Growth: Analyst consensus points to a projected 13.5% year-over-year decline in Q4 revenue, with stagnant growth expected into early 2025.
-
Earnings Erosion: Forecasts predict a drop in Earnings Per Share (EPS) from $9.49 in 2024 to $8.08 in 2025, potentially falling further to $6.85 in 2026.
-
The Fee Pressure Risk: The primary threat is a potential fee compression as Coinbase may be forced to lower its transaction costs to compete with new, low-margin entrants from the traditional finance sector.
Technical Breakdown: Chart Points to Lower Levels
The price chart of COIN stock corroborates the fundamental concerns, displaying a classic bearish structure.
-
Failed Support: The stock has decisively broken below the crucial $290 support level, which previously acted as a floor in August and September. This level has now flipped into resistance.
-
“Death Cross” Looming: The 50-day and 200-day Exponential Moving Averages (EMAs) are converging, threatening to form a “death cross”—a widely watched bearish technical signal.
-
Break-and-Retest Pattern: A potential retest of the broken $290 support-turned-resistance could set up a classic “break-and-retest” failure, often leading to a continuation of the downtrend. The next major support in such a scenario lies at $200.
Coinbase Stock Prediction: Navigating the Downtrend
The outlook for Coinbase stock in the near term is cautionary. The combination of intensifying competition, weakening financial projections, and a broken technical structure creates a high-probability path toward lower prices.
-
Bearish Scenario (Higher Probability): A confirmed rejection at the $290 resistance level would validate the breakdown and likely initiate a move toward the $200 support zone.
-
Bullish Invalidation: For the bearish thesis to be overturned, COIN would need to reclaim and hold above the $290 level with strong volume, negating the recent breakdown and signaling a recovery of buyer control.
Investors should monitor the stock’s interaction with the $290 level closely, as it will serve as the primary indicator for the next significant directional move.
