Goldman Sachs said in an Aug. 24 report on the Americas brokers and cryptocurrency industry that it is “cautiously optimistic” on the second half, arguing that a recovery in crypto markets would create added upside for related equities.
According to the report, crypto trading dropped 30% in July and another 21% in August, extending the decline to 10 consecutive months. Goldman said that stretch is already longer than the median duration seen across the previous five cycles. It framed the opportunity set differently across segments: traditional brokers are tied to a seasonal rebound in September, prediction markets are tied to the election cycle, and crypto names depend on three catalysts — a rebound in market capitalization, cost cuts, and regulatory reform. Goldman also said the broader group is valued at only the 30th percentile of its historical range over the past five years.
Trading downturn has stretched past the historical median
Goldman said crypto trading volume is now down 75% from its peak in the current cycle, with the slump lasting 10 months, longer than the four-month median across the prior five downturns. Crypto market capitalization rebounded 21% over the past week. The bank noted that a similar rebound in April and May did not hold, but said a sustained move at current levels could mark a turning point for trading volumes.
Its prime brokerage survey showed that 35% of institutional investors see regulatory uncertainty as the biggest obstacle to entering the crypto market, while 32% identify regulatory clarity as the primary catalyst for institutional adoption. In Goldman’s view, that leaves the direction of regulation central to any broader recovery in activity.
Regulatory reform remains part of the setup
The report said the odds of the CLARITY Act passing before the midterm elections continue to fall, but U.S. regulators are still moving on substantive changes. The Securities and Exchange Commission has recently proposed an innovation exemption, and more than 10 digital asset companies newly received Office of the Comptroller of the Currency bank charters in 2026. In total, more than 15 crypto firms have now entered the federal banking system.
Goldman said those changes could matter for crypto infrastructure businesses, including custody, staking and stablecoins. It also said a true step-up in institutional adoption still depends on legislation being finalized.
Cost cuts are cushioning profit pressure
Goldman said crypto companies have already moved to reduce expenses in response to weak market conditions. Across the names it covers, it estimates average expense reductions of about 5% in 2026. Those measures include layoffs, lower marketing spending and tighter technology infrastructure budgets.
The effect is showing up directly in profitability. Goldman estimated that lower expenses lifted operating margins by about 5.8 percentage points, offsetting part of the hit from weaker revenue. That, the bank said, has helped crypto companies maintain positive operating cash flow ahead of any recovery in top-line growth and preserve room to maneuver in the next cycle.
Four names highlighted by Goldman
Goldman selected four buy-rated stocks from its coverage universe.
- HOOD: target price of $124. Goldman said structural account asset growth is running above 20% annualized, while the Rothera prediction market exchange reached the industry’s top three in less than two months after launch, contributing about $150 million in annualized revenue.
- IBKR: target price of $114 and included on Goldman’s U.S. Conviction List. The bank expects account growth above 30% in 2026, with 85% of new accounts coming from outside the U.S. and pretax margins above 75% supporting capital generation.
- FIGR: target price of $43. Goldman said transaction volume on its HELOC lending platform rose more than 100% year over year in July. It also said the number of partners increased from 178 in 2025 to 102 in the second quarter of 2026 and continues to accelerate.
- COIN: target price of $196. Goldman said the company has gained about 8 percentage points of market share in crypto derivatives since the first quarter of 2024, and subscription and services revenue now accounts for about 40% of total revenue. If the SEC innovation exemption is implemented, Goldman said Coinbase’s institutional token services would directly benefit. It also said the stock is trading at about 28 times forward earnings, placing it at only the 5th percentile of its post-listing historical range.
Different catalysts across asset classes
Goldman’s conclusion was that the three groups are being driven by different forces: traditional brokers by a September seasonal turn, prediction markets by the election cycle, and crypto equities by the combined effect of market-cap stabilization, cost discipline and regulatory reform. The bank said valuations across the sector already reflect a substantial amount of pessimism.
The ratings, target prices, earnings forecasts and related views cited here are drawn from Goldman Sachs’ Aug. 24, 2026 research report as summarized by the source article and reflect the position of the bank’s analysts, not investment advice.
