Coinbase is falling after revenue miss, but Citigroup says a rebound is coming. Here's why

The crypto market structure bill wending its way through Congress —known as the CLARITY Act — could significantly boost Coinbase's growth prospects if it passes, according to Citigroup. Shares of Coinbase are falling after it posted a surprise first-quarter loss on Thursday evening. Trading activity on the platform fell, hurt by the slump in crypto prices in the first three months of the year. Subscription revenue – meant to help Coinbase diversify away from its reliance on speculative trading – also underperformed. Citi is optimistic on the stock long-term, however, and is particularly bullish on stablecoins, payments and institutional adoption — and if CLARITY passes, it would allow more products to be introduced in those businesses as well and foster more institutional participation, analysts said in a note Friday. "Ultimately, we see potential CLARITY passage as the significant upside catalyst for COIN," Citi said. The investment bank also pointed to the Coinbase Developer Platform, a suite of tools and services for developers to build on-chain applications, as a potential catalyst for the stock, saying it's "prepared to handle post-CLARITY demand from [traditional finance]." Last week, lawmakers struck a compromise on key language proposed in the crypto legislation regarding interest paid to users on stablecoin balances and activity. …