Barclays calls 2026 a slow, transitional year for crypto as retail spot trading fades, Coinbase’s outlook is cut, and tokenization plus U.S. regulation stay long-term plays.
Summary
- Barclays says weakening retail participation and falling spot volumes could make 2026 a down year for crypto exchanges and trading platforms.
- The bank trims its Coinbase target as spot trading shrinks and costs rise, even as the exchange pushes into derivatives, tokenized equities and diversification.
- Barclays highlights tokenization and U.S. reforms like the CLARITY Act as long-term tailwinds, but warns regulatory progress and earnings impact will be gradual.
Barclays has issued a cautious outlook for the cryptocurrency sector in 2026, projecting declining trading activity and limited catalysts for growth, according to a year-end research report from the bank.
Barclays pivots towards acceptance of digital asset exchanges
The financial institution stated that digital asset exchanges face challenges as retail participation weakens and spot trading volumes decrease. The bank characterized 2026 as a transitional period for the industry, marking a departure from the volatile boom-and-bust cycles that have defined crypto markets in recent years.
Retail-focused platforms including Coinbase and Robinhood are experiencing pressure from declining spot trading volumes, which represent a critical revenue source for exchanges, according to the report. “Spot crypto trading volumes appear to be trending towards a down-year in FY26, and it is not clear to us what might reverse this trend,” the analysts stated.
The bank noted that previous bull cycles were fueled by heightened volatility and speculative demand that drove surges in retail trading. That dynamic has weakened significantly, with fewer active traders participating in spot markets and reduced price action to attract new entrants, according to the analysis.
Cryptocurrency markets have historically responded to major events such as regulatory announcements, product launches and political developments. Barclays cited past activity spikes, including the approval of spot Bitcoin exchange-traded funds in March 2024 and the rally following a pro-crypto outcome in the U.S. presidential election later that year. However, the bank stated that few comparable catalysts appear imminent through 2026.
The report identified potential regulatory progress in the United States as a possible positive factor. Barclays highlighted the proposed CLARITY Act, legislation aimed at defining whether digital assets fall under securities or commodities law and clarifying oversight between the Securities and Exchange Commission and the Commodity Futures Trading Commission.
The bank stated that clearer regulatory rules could encourage compliant product launches, particularly in tokenized assets, but cautioned that benefits would likely emerge gradually rather than triggering immediate market activity.
Coinbase received significant attention in the Barclays analysis due to its position as a major U.S. crypto exchange. The company is expanding into derivatives trading, tokenized equities and other initiatives, alongside recent acquisitions aimed at revenue diversification, according to the report. Barclays revised its price target for Coinbase shares downward, citing shrinking spot volumes and rising operating costs despite longer-term strategic investments.
Tokenization continues to attract interest from crypto-native companies and traditional financial institutions. Firms including BlackRock and Robinhood have launched pilot programs and early-stage offerings tied to tokenized assets, according to the bank. Barclays acknowledged the strategic importance of these initiatives but stated the trend remains too early-stage to materially affect earnings in 2026, describing tokenization as a long-term growth opportunity.
Despite a more favorable political environment toward digital assets following recent U.S. elections, Barclays stated that much of the optimism appears priced into markets. Legislative progress, including the CLARITY Act, would require Senate approval and could face legal challenges before having practical impact, according to the report.
The bank characterized 2026 as a transitional year for the cryptocurrency sector, with companies focusing on long-term investments in compliance, infrastructure and tokenized finance amid declining retail activity and limited near-term growth drivers.
