Coinbase Files SEC Application to Launch Tokenized Stock Trading

Coinbase stock trading expansion could bring 24/7 equity markets and lower fees to 50 million retail investors

Key Takeaways

• Coinbase seeks SEC approval for tokenized stock trading to diversify beyond crypto and compete with traditional brokerages through 24/7 trading and lower transaction costs
• Stock surges to $354.20 per share, setting 52-week high following passage of the GENIUS Act and analyst price target increases from $310 to $510
• USDC revenue reaches $298 million in latest quarter representing 15% of total revenue and 51% year-over-year growth as stablecoin business expands

Introduction

Coinbase has filed for SEC approval to offer tokenized stock trading on its platform, marking a strategic pivot that could reshape both the cryptocurrency and traditional brokerage industries. The move positions the exchange to compete directly with established players like Robinhood and Charles Schwab by offering digital versions of traditional equities with 24/7 trading capabilities.

This initiative comes as the company’s stock reaches new heights, trading at $354.20 per share and setting a 52-week high. The surge follows favorable regulatory developments and analyst upgrades that signal growing confidence in Coinbase’s expansion strategy beyond its core crypto trading business.

Key Developments

Coinbase’s tokenized equity proposal leverages blockchain technology to enable faster settlement times and reduced transaction costs for investors. The platform would offer digital versions of traditional stocks, allowing users to trade equities around the clock rather than during standard market hours.

The timing aligns with the U.S. Senate’s passage of the GENIUS Act by a 68-30 bipartisan vote. This legislation establishes regulatory guardrails for stablecoin issuers, requiring 1:1 reserve backing in safe assets and anti-money laundering compliance while permitting non-bank entities to issue stablecoins.

Coinbase became the first U.S. crypto firm to join the S&P 500 in May 2025, cementing its position as a mainstream financial institution. The company’s recent quarterly results showed earnings per share of $0.24 and revenues of $2 billion, though these figures fell short of analyst expectations.

Market Impact

Coinbase shares have surged 37.8% since the beginning of the year, with recent gains accelerating following regulatory developments. The stock jumped 5.9% in pre-market trading after Bernstein analyst Gautam Chhugani raised his price target from $310 to $510.

USDC revenue performance highlights the company’s diversification success, generating $298 million in the most recent quarter. This represents approximately 15% of total revenue and demonstrates 51% year-over-year growth in the stablecoin segment.

The broader tokenization trend gains momentum as institutional players explore blockchain-based infrastructure for traditional financial products. Treasury Secretary Scott Bessent projects the U.S. stablecoin market could expand nearly eightfold to exceed $2 trillion in coming years.

Strategic Insights

Coinbase’s tokenized equity initiative represents a convergence of crypto and traditional finance that could disrupt multiple market segments. The platform’s ability to offer continuous trading and lower costs creates competitive advantages against both traditional brokerages and crypto-native rivals like Kraken.

The GENIUS Act partnership with Circle Internet Group, USDC’s issuer, strengthens Coinbase’s position in the rapidly expanding stablecoin market. This regulatory framework provides clarity for stablecoin operations while maintaining innovation flexibility.

Revenue diversification becomes increasingly critical as crypto trading volumes face volatility. The tokenized securities market offers substantial growth potential, particularly as institutional adoption accelerates and regulatory barriers diminish.

Expert Opinions and Data

Coinbase chief legal officer Paul Grewal describes the tokenized equity initiative as both “exciting” and “important,” emphasizing the need for regulatory clarity to unlock market potential. His comments reflect the company’s confidence in navigating complex compliance requirements.

Bernstein’s Chhugani notes that Coinbase “dominates U.S. crypto trading market, runs the largest stablecoin business amongst exchanges, dominates institutional crypto, acquired the largest global crypto options exchange.” His analysis supports the elevated price target based on the company’s market-leading positions across multiple segments.

Barclays analysts highlight potential benefits including “back-office cost savings, faster settlement times, and potentially easier facilitation of international access.” These operational advantages could drive market share expansion and revenue growth if regulatory approval materializes.

Conclusion

Coinbase’s pursuit of tokenized stock trading approval represents a calculated expansion into traditional finance that leverages its blockchain expertise and regulatory relationships. The company’s stock performance reflects investor confidence in this strategic direction, supported by favorable legislative developments and strong stablecoin revenue growth.

The initiative’s success depends on SEC approval for tokenized securities, which remains uncertain given the complex regulatory landscape. However, the GENIUS Act’s passage and growing institutional interest in asset tokenization create a more favorable environment for Coinbase’s ambitious expansion plans.