Bernstein: Crypto Stocks Down 60%, Analyst Sees 'Big Discount' Opportunity
Wall Street brokerage Bernstein released a note on Monday stating that crypto-linked equities are approaching a cyclical bottom after a steep ~60% drawdown from 2025 highs. Analyst Gautam Chhugani framed the pullback as a potential "big discount" entry opportunity ahead of first-quarter earnings.
The firm said the combination of macro uncertainty, geopolitical tension, and weak crypto sentiment has pressured valuations across the sector, but argued that fundamentals tied to long-term growth themes remain intact. Bernstein lowered price targets on major names: Coinbase to $330 from $440, Robinhood to $130 from $160, and Figure to $67 from $72. All three remain rated Outperform.
The broker estimates crypto equities have retraced roughly 60% from their 2025 peak, alongside a broader crypto market correction that erased trillions in value. Bitcoin itself has fallen sharply from record highs, contributing to weaker trading activity and sentiment. Still, Bernstein pointed to structural growth drivers including stablecoins, tokenization, prediction markets, and derivatives. It also argued that crypto exposure remains a smaller share of Robinhood's revenue base, while Figure is positioned as a pure-play tokenization business. The firm expects Q1 earnings weakness to mark a sentiment floor before recovery into the second half of 2026.
Crypto and Bitcoin Continue Slumping
This note comes as Bitcoin traded lower over the weekend after remarks from Donald Trump suggesting the United States is engaged in discussions with a new leadership structure in Iran and that progress toward a potential agreement is underway. The moves followed a weekend dip toward $64,000 and reinforced a broader rangebound structure between roughly $65,000 and $70,000.
Sentiment was driven by escalating tensions in the Middle East, where the conflict between Iran and Israel has intensified, with strikes on Iranian targets and regional spillovers affecting Kuwait and other Gulf states. Reports of missile and drone activity, risks to energy infrastructure, and threats to shipping routes in the Strait of Hormuz have kept global markets on edge. U.S. President Donald Trump has alternated between diplomatic signals and severe threats toward Iran's energy infrastructure, while U.S. Secretary of State Marco Rubio has been cited in discussions suggesting regime change dynamics may be emerging, with Pakistan attempting to facilitate indirect talks.
Beyond geopolitics, derivatives positioning has also contributed to muted volatility. Institutional investors selling covered call options have shifted gamma exposure to market makers, whose hedging activity dampens price swings by buying dips and selling rallies. Overall, Bitcoin remains rangebound as markets digest geopolitical risk, options-driven volatility suppression, and macroeconomic uncertainty, while traders await clearer direction from both policy signals and liquidity trends. This comes as institutional positioning continues to offset retail-driven momentum and headline shocks in a tightly controlled trading environment through early spring 2026 cycle period.