A Base token could be worth as much as $34 billion, JPMorgan analysts said in a research note on Friday.
A new token, along with the waning threat of decentralised exchanges and better monetisation of USDC rewards, could boost Coinbase stock 14% to $404 per share by December 2026, the analysts said.
Base is a layer 2 blockchain built by Coinbase. Its $5 billion DeFi ecosystem is the sixth-largest among all blockchains and the largest among Ethereum’s layer 2 blockchains, according to DefiLlama data.
While Coinbase leadership initially said the blockchain would not have its own native token, they’ve changed their tune in recent weeks, the analysts note.
If Coinbase were to create the token, it could be worth anywhere from $12 billion to $34 billion, according to the analysts.
Moreover, if Coinbase were to hold onto 40% of the supply, that would mean a $4 billion to $12 billion opportunity for the crypto exchange.
Coinbase could further boost its stock by slashing rewards to most users and instead focusing on Coinbase One customers.
Such a move would emulate Robinhood’s Gold program, whose customers enjoy a higher yield on cash deposits.
Eliminating yield for all but Coinbase One customers could boost earnings by $347 per year, or $1 per share, at current interest rate levels, according to the analysts.
They also see decentralised exchanges posing a waning threat to Coinbase earnings.
This year’s breakneck growth of decentralised exchanges, or DEXes, has stalled, and Coinbase is poised to benefit from its own effort to integrate the technology into the Base app.
In June, Coinbase said it would integrate decentralised crypto exchanges into its mobile app, letting traders buy and sell virtually every crypto asset, rather than the hundreds it currently offers.
“We’ve seen millions of assets get created and traded on decentralised exchanges, but only few people have been able to navigate those decentralised exchanges to access and trade the assets that they want,” Max Branzburg, Coinbase’s head of consumer and business products, said at a company conference in lower Manhattan.
“Coinbase will be going from one asset 13 years ago in Bitcoin to hundreds of assets today to soon having every asset onchain available to trade in the Coinbase app by default.”
JPMorgan analysts expect Coinbase to monetise access to DEXes via Base sequencer fees.
Aleks Gilbert is DL News’ New York-based DeFi correspondent. You can reach him at aleks@dlnews.com.
