Institutional Interest In ETH To Benfit Coinbase Says Bernstein

In This Article

What’s Coinbase’s Play?
Institutional Interest In ETH Follows BTC’s Playbook

The alt season is officially underway, with ETH (Ethereum) leading the charge in institutional interest.

Bernstein, a recognised research and brokerage firm, has backed ETH-native platforms like Coinbase to benefit from the current market dynamics.

Bernstein issued a client memo on 11 August 2025, highlighting an 80% surge in ETH since 5 June 2025. This was parallel to Circle’s successful IPO, suggesting ETH’s growing domination in stablecoin issuance.

In the memo, Gautam Chhugani, an analyst at Bernstein, stated, “In crypto lingo, this market structure is called the ‘alt rally’, i.e. when digital assets other than bitcoin rally stronger relative to bitcoin.”

Bernstein says Coinbase is set to benefit most as ETH climbs to multi-year highs and alt season begins. ETH strength is lifting trading volumes, staking revenue, and overall activity across the Ethereum ecosystem.

For @aave, this means higher lending demand can occur, more… pic.twitter.com/8JU40aKsWm

— darknight.eth (@darknight_ethh) August 12, 2025

Since last week, the rally has kicked up a notch, with ETH breaching the $ 4,000 mark for the first time in eight months, briefly topping $4,350 before stabilising near $4,186.

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What’s Coinbase’s Play?

With institutional interest in ETH on the up, Coinbase is perched, looking pretty to take advantage of the situation. The platform has over 250 tokens with Base-chain integrations that make it possible for it to be an active participant in ETH’s resurgence.

“We believe the alt rally has commenced and Coinbase will be the biggest beneficiary, given its long list of 250+ tokens listed and now the long-tail of Base chain tokens integrated in the Coinbase App,” Chhugani noted.

Coinbase heavily skews a lot of its operations towards ETH. Take its staking operations, for example, through which it derives more than 10% of its revenue. In addition to this, its layer 2 blockchain, Base, processes over 9 million transactions daily.

Furthermore, the chain generates an estimated $75 million in sequencer fees that flow back to Coinbase. The chain’s embedded token economy also boosts trading activity across the platform.

In its memo, Bernstein declared that Q2 didn’t matter and dismissed Coinbase’s 15% stock drop in late July as a one-off since the crypto market had not fully found its footing.

Bernstein analysts predict Coinbase will benefit most from ETH’s rally to multi-year peaks and alt season begins, positioning the crypto exchange to leverage surge in trading volume from supported tokens and staked assets. pic.twitter.com/RscvLQGML7

— Dani Gigante (@Dsgigante) August 12, 2025

Notably, by July, the trading volumes had climbed 40% above Q2 averages, suggesting a renewed market demand. Bernstein’s memo framed Q3 and Q4 as the performance benchmark that investors should look out for.

“From a revenue materiality standpoint, a rising ETH, followed by several ETH-linked ecosystem tokens, leads to a surge in trading volume and fees for Coinbase,” explained Chhugani.

Given Coinbase’s transaction-driven revenue model, a persistent ETH rally could outperform its revenue projections.

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Institutional Interest In ETH Follows BTC’s Playbook

Zooming back a little, it seems likely that ETH is tracing BTC’s institutional path. According to Bernstein, BTC’s evolution from spot ETF to balance sheet adoption is being studied and followed by ETH.

Additionally, the research firm highlights the rise of ETH-focused treasuries, mirroring Michael Saylor Strategy’s BTC play as a new avenue for investment exposure.

While analysts at Bernstein highlight that it is still early in the crypto bull cycle, several investment opportunities stand to gain as volumes rise and crypto moves further into the mainstream.

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Key Takeaways

Bernstein analysts comment that the alt-season is officially on
Coinbase has a unique position to take advantage of ETH’s resurgence
Bernstein suggests that ETH’s institutional take-off is taking a page out of BTC’s playbook