What Happened?
Shares of blockchain infrastructure company Coinbase (NASDAQ: COIN) jumped 11.3% in the afternoon session after crypto linked stocks secured a major victory as the Senate passed the GENIUS Act (a bill that outlines regulatory guidelines for stablecoins).
Stablecoins are cryptocurrencies designed to keep a steady value, usually pegged to the U.S. dollar.
The bill provides a much-needed legal framework and aims to build trust in digital assets.
For Coinbase, a major player in the stablecoin market and the broader crypto ecosystem, this new law reduces regulatory uncertainty and could pave the way for increased institutional and retail adoption.
To quantify the market opportunity, Treasury Secretary Scott Bessent told lawmakers that the U.S. stablecoin market could explode to over $2 trillion in the next few years, growing nearly eightfold.
Adding to the positive news, Coinbase sought regulatory approval from the U.S. Securities and Exchange Commission (SEC) to offer tokenized equities. Coinbase's Chief Legal Officer, Paul Grewal, noted in a Reuters interview that the concept is a "huge priority."
Barclays analysts weighed in, highlighting some of the merits, including "back-office cost savings, faster settlement times, and potentially easier facilitation of international access."
This suggests that tokenized equities could help COIN expand its market share and ultimately grow its revenue as it offers more tradable assets and options to its users.
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What The Market Is Telling Us
Coinbase’s shares are extremely volatile and have had 64 moves greater than 5% over the last year. But moves this big are rare even for Coinbase and indicate this news significantly impacted the market’s perception of the business.
The previous big move we wrote about was 15 days ago when the stock gained 5.1% as stocks edged higher (Nasdaq +0.9%, S&P +0.6%) while momentum in the crypto space picked up amid concerns the proposed spending bill (One Big Beautiful Bill) would raise the already bloated US fiscal deficit, making it difficult to keep inflation under control.
Inflation fears, partly triggered by the ongoing trade war, have driven a demand for safe-haven assets and alternative stores of value. These concerns are fueling demand for digital assets, with Bitcoin reaching a new all-time high in May 2025. For crypto-linked stocks like Coinbase, this means more people are trading, which often translates into sales.
Coinbase is up 11.1% since the beginning of the year, but at $285.91 per share, it is still trading 16.8% below its 52-week high of $343.62 from December 2024. Investors who bought $1,000 worth of Coinbase’s shares at the IPO in April 2021 would now be looking at an investment worth $870.80.
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