Coinbase, Robinhood prediction markets drive investor focus beyond weak trading quarter

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Highlights

Coinbase expects Q1 2026 trading volumes of $35 billion (consumer) and $167 billion (institutional), both below Wall Street forecasts, amid a 23% Bitcoin and 29% ether price drop.
Despite short-term softness, Cantor Fitzgerald raises Coinbase's price target to $250 and Robinhood's to $110, citing positive sentiment, product pipeline, and moves into prediction markets and tokenization.
The New York Attorney General files a lawsuit against Coinbase and Gemini over prediction markets, intensifying regulatory uncertainty as state and federal oversight tests new business segments.

Product roadmap offsets softer quarter

As reported by CoinDesk, Cantor Fitzgerald analyst Ramsey El-Assal says investors are increasingly treating upcoming quarterly results as backward-looking and focusing instead on demand trends and the product pipeline at Coinbase and Robinhood.

Both companies are expected to post weaker first-quarter 2026 results after a decline in crypto prices and trading activity. Bitcoin and ether fall about 23% and 29% in the quarter, pressuring exchange volumes, while third-party data show Coinbase volumes sliding from about $66 billion in January to $54 billion in March.

Cantor estimates Coinbase consumer and institutional trading volumes at $35 billion and $167 billion, respectively, both below Wall Street expectations. The firm also projects exchange revenue below consensus, but keeps an overweight rating on the stock and raises its price target to $250, citing improving sentiment and longer-term growth drivers.

Robinhood faces similar near-term pressure from softer trading volumes and lower net interest revenue as rates ease. Cantor says higher market volatility can still support trading margins, while stronger yields in equities and options may partly offset weaker activity, even as crypto revenue quality comes under pressure from the platform's tiered pricing structure.

Regulatory risks and growth outlook

The recent rebound in both stocks suggests investors are looking past current market weakness. Coinbase shares are up about 18% quarter-to-date, while Robinhood rises roughly 40% in April from late-March lows, supported by better risk sentiment and easing geopolitical tensions.

For Coinbase, investors are watching regulatory developments and expansion into new business lines, with its prediction markets offering launched this year continuing to draw interest. Robinhood is also pushing further into prediction markets, while adding tokenization and private market access, moves that Cantor says could help drive future growth alongside potential updates to pattern day trading rules.

Cantor maintains an overweight rating on Robinhood and raises its price target to $110. El-Assal says the broader shift is that, while current trading trends remain linked to crypto price cycles, the next phase of growth depends more on product expansion and new use cases.

Later on Tuesday, the New York Attorney General's office files a lawsuit against Coinbase and Gemini over their prediction market offerings, alleging the products are gambling products that violate state regulations. The legal dispute adds uncertainty to a market segment that is already being debated in state and federal courts, with the Commodity Futures Trading Commission arguing prediction markets are swaps under federal oversight, while states contend some sports-related contracts should be regulated at the state level.

Our previous coverage of Coinbase’s COIN price analysis highlighted how the stock was navigating fresh legal pressure in New York alongside corporate governance changes, even as the company rolled out new products. That update noted mixed technical signals and a likely near-term consolidation range, with regulatory headlines remaining a key overhang for sentiment.

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