GM. This is Milk Road, the daily newsletter that's the emergency exit from crypto Twitter noise.
Here’s what we’ve got for you today:
- ✍️ Everyone's buying Coinbase wrong.
- 🎙️ The Milk Road Show: Has ETH/BTC Bottomed and Who Leads From Here?
- 🍪 Novogratz: Ethereum's story was always different to Bitcoin’s.
If you're shipping well past midnight and need your focus to hold as long as your agents can, Roon is your answer. Claim 54% off Roon.
Prices as of 2:00 p.m. ET. Powered by CoinGecko.
EVERYONE'S BUYING COINBASE FOR THE WRONG REASON 🪙
COIN popped nearly 10% yesterday.
The reason? The CLARITY Act cleared another hurdle in the Senate.
And the whole market read it the same way: the Coinbase trade has finally arrived.
We think they're buying it for the wrong reason...
Treasury Secretary Scott Bessent said the CLARITY Act (the bill that would set America's official rulebook for crypto) is on the "one-yard line" in the Senate.
On top of that, the White House cleared the ethics package that had been jamming everything up.
The bill already cleared the Senate Banking Committee on a 15-9 vote. That's the most real progress crypto market structure has made all cycle.
And right now, it looks good for Coinbase:
But regulatory clarity cuts both ways.
The same clear rules that help Coinbase also invite banks and fintechs straight into its market.
Every bank that's been parked on the sidelines waiting for a green light gets one too (the barrier drops for everyone, not just the incumbent).
Meaning the ‘clean moat’ story the headline implies doesn't hold up.
… so what actually moves this stock?
Crypto volumes.
Coinbase is a leveraged bet on how much crypto the world trades (when volumes rise, its revenue rises faster).
That's the whole ballgame.
And the bigger driver from here is institutional money…
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EVERYONE'S BUYING COINBASE FOR THE WRONG REASON (P2) 🪙
Clear regulatory rules hand asset managers, banks and corporates the rulebook they've been waiting for.
Coinbase is the default choice for a lot of them across:
- Custody.
- Stablecoins.
- Payments.
- Lending.
- Trading.
Most of that institutional cash is still sitting on the sidelines today.
Clear rules are the thing that finally gets their compliance teams to say yes, and for Coinbase to start collecting fees from them.
And with that pipeline, Coinbase becomes less of a cyclical crypto exchange and more of a tech platform.
(Exchanges live and die with the cycle. Platforms get paid whether volumes are hot or cold.)
If you think crypto volumes grind higher over the next few years thanks to institutional adoption (like we do), this is one of the cleanest ways to own that move.
The risk? After a 10% pop, part of that regulatory hope is already baked into the price.
Prediction markets still put a 2026 passage at around 41%.
And the Democrats whose votes the bill needs (seven of them have to cross over) say they got shut out of the ethics talks.
If passage slips to 2027, COIN gives this pop back fast.
(The stock is still down ~22% on the year, so sentiment is fragile here.)
We're fine with that.
The platform thesis doesn't need the bill to pass this year. Passage just speeds it up.
We've been long Coinbase since 2023, and we're not selling it (or buying it) on a single headline.
Own the platform, not the ruling.
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Lyn Alden: The U.S. runs ~7% annual money supply growth historically - and the things you can't make more of (e.g. BTC) absorb the excess money creation disproportionately.
Tom Lee: Two independent technical analysts are pointing at the same $2,200 ETH price target right now.
Novogratz: Ethereum's story was always different to Bitcoin’s. It needed Vitalik. And Vitalik stepping back hurt the ecosystem more than people realize.
Wanna use your Bitcoin without selling it? Peoples Reserve goes beyond basic crypto lending with borrowing, mortgage, yield, swap, and spending tools.
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