Shares of leading cryptocurrency exchanges Coinbase, Gemini, and Bullish have plunged by as much as 55% over the past three months, reflecting a severe and sustained downturn in trading activity across the market. This decline starkly outpaces the broader crypto market's slump, with Bitcoin having fallen over 35% since its peak in October 2023, and January marking its fourth consecutive monthly loss—the longest such streak since 2018.
The core issue is a dramatic evaporation of trading volume, which directly impacts the fee-based revenue models of these platforms. Clear Street analyst Owen Lau estimates that Coinbase's Q4 2025 trading volume likely fell 40% year-over-year to $264 billion. The situation worsened in January, with trading on track to bring in less than half of the volume seen in the same period last year. "When prices are going up, people don't want to miss out, so they trade," noted Peter Christiansen, head of digital asset equity research at Citigroup, highlighting how the current bearish sentiment has killed momentum.
The downturn is forcing exchanges to revise their financial projections. Needham & Co. analyst John Todaro stated that Gemini, which initially aimed to break even by 2027, now likely won't reach that milestone until 2028 due to reduced platform engagement. Similarly, Bullish, which caters primarily to institutional clients, saw its January trading volumes drop 28% year-over-year, indicating that even large market participants are pulling back.
Analysts point to a confluence of factors driving the slowdown, including macroeconomic headwinds like rising AI costs, geopolitical uncertainty, and outflows from technology stocks, which are making investors more defensive. Kaiko research analyst Laurens Fraussen provided a sobering outlook, suggesting the current market cycle may only be about 25% complete and that a significant recovery could require another six to nine months of subdued activity.
