Investment bank Compass Point initiated coverage of crypto exchange Bullish (BLSH) with a 'neutral' rating and a $45 price target, approximately 16% below its current trading price of around $54-59. Analysts Ed Engel and Abdullah Dilawar expressed concerns over the stock's valuation, noting it trades at 110 times its projected 2026 core operating profit, which they consider unjustifiably high.
Regulatory challenges are a significant barrier. The analysts believe Bullish cannot enter the U.S. market until Congress passes the CLARITY Act, which may not occur until the first half of 2026. New York's restrictive BitLicense requirements pose additional hurdles, as the state's Department of Financial Services is historically less hospitable to novel blockchain technologies. Bullish's automated market maker system, where it acts as its own market maker, could raise conflict-of-interest concerns with regulators.
Bullish went public on the NYSE in August, debuting at $37 and peaking at $118 before settling near current levels. The stock closed down 12% on Wednesday following the report. Despite the challenges, analysts noted that if Bullish secures U.S. approval, its lower fee structure could make it a strong competitor to Coinbase in the institutional market. The company holds a $2.7 billion crypto treasury, mostly in bitcoin, tying its stock performance closely to BTC price movements. Engel's $45 target assumes bitcoin reaches $160,000 and includes a 50% probability of U.S. market entry, which could add $12 per share in value.
