Crypto-linked equities have been hammered by a 60% drawdown from their 2025 highs, but Wall Street broker Bernstein argues this volatility represents a rare entry point for long-term investors. While near-term headwinds persist, the firm maintains that the current valuation disconnect creates a "big discount" for blue-chip players in the sector.
Why are crypto stocks trading at a 60% discount?
The current market environment is a cocktail of geopolitical tension and lingering regulatory uncertainty that has forced a mass unwinding of leverage. Since peaking in October 2025, the broader digital asset market has shed approximately $2 trillion in value. With Bitcoin retreating roughly 40%–50% from its all-time highs of $126,000, retail and institutional sentiment has shifted into a defensive posture.
Bernstein analysts, led by Gautam Chhugani, noted in a Monday report that this "temporary crypto weak sentiment" is obscuring the underlying growth potential of companies building the infrastructure for stablecoins, tokenization, and derivatives. As multiple outlets have noted, the market is currently bracing for Q1 earnings, which Bernstein expects to act as a clearing event for fundamentals.
How have price targets for COIN, HOOD, and FIGR changed?
Despite the long-term bullish thesis, Bernstein has adjusted its short-term price targets to reflect the current macro environment. The firm maintains an "outperform" rating on these assets, suggesting that while the path forward is volatile, the current price levels are attractive for those with a multi-year horizon.
| Company | Previous Target | New Target | Current Price (Approx) |
|---|---|---|---|
| Coinbase (COIN) | $440 | $330 | $165.50 |
| Robinhood (HOOD) | $160 | $130 | $67.10 |
| Figure (FIGR) | $72 | $67 | $31.14 |
For investors tracking these moves, understanding how infrastructure plays are evolving is key. As Aave v4 launches on Ethereum to bridge DeFi liquidity with real-world assets, it becomes clear that the sector's utility is expanding far beyond simple price speculation. This trend is mirrored in Hong Kong's move to integrate tokenized bonds into core financial infrastructure, further validating the long-term institutional thesis.
Is the crypto market bottoming out?
Bernstein’s outlook on equities aligns with their broader view on digital assets. The firm previously signaled that Bitcoin has likely found its floor and continues to hold a year-end price target of $150,000. For those monitoring the broader Bitcoin market data, the current compression suggests that we are in a consolidation phase rather than a structural collapse. However, traders should remain wary of on-chain signals; as liquidity remains thin, volatility is expected to continue until the Q1 earnings reports provide clarity on institutional adoption rates.
FAQ
1. Why did Bernstein lower price targets if they are bullish? They lowered targets to account for near-term macro pressures and weak sentiment, but they maintain "outperform" ratings, viewing the current 60% dip as a valuation-based entry point.
2. What sectors does Bernstein see as the primary growth drivers? They are focused on companies with exposure to stablecoins, tokenization, prediction markets, and derivatives—areas they view as the "big businesses" of the future.
3. Is this a good time to buy crypto stocks? Bernstein suggests that while Q1 results may show continued weakness, the current discounts offer a strategic opportunity for long-term investors to accumulate at depressed valuations.
Market Signal
Investors should watch the $126k resistance level for BTC as a primary indicator for equity recovery. If Q1 earnings confirm stable revenue from tokenization and stablecoin products, look for a mean reversion in COIN and HOOD toward the $200 and $90 levels respectively.