Coinbase Global shares soared on Tuesday after S&P Global announced the crypto exchange’s addition to the S&P 500 index, delivering the stock’s biggest one-day gain since the post-election rally in November 2024. At the close, Coinbase was up 23.97% at US$256.90, marking a dramatic turnaround from spring volatility and underscoring growing institutional embrace of digital-asset markets.
Index-Driven Buying Boosts Share Price
Coinbase will replace Discover Financial Services in the S&P 500, effective before the market opens next Monday. That change forces index-tracking funds to purchase Coinbase shares, creating a mechanical demand estimated at up to US$9 billion in passive inflows. Similar S&P additions have historically generated large short-term injections of capital—Tesla’s December 2020 inclusion, for instance, ultimately drew more than US$50 billion in index-fund purchases.
Sharpest Rally Since Trump Election Pop
The 24% surge on Tuesday is Coinbase’s strongest single-session advance since Nov. 6, 2024, when shares jumped over 30% on expectations of a more crypto-friendly Trump administration. After an uneven first quarter—down 26% in February and 20% in March amid tariff-induced market swings—Coinbase is now modestly positive year-to-date, up around 3.5%.
Earnings and Acquisition Propel Momentum
Coinbase last week reported Q1 net income of US$65.6 million (24 cents per share), down from US$1.18 billion a year ago after fair-value adjustments on its crypto holdings, but still meeting the S&P’s profitability requirements. Revenue climbed 24% to US$2.03 billion, driven by rising institutional trading and custody fees.
Adding to its growth narrative, Coinbase unveiled plans to acquire Dubai-based Deribit for US$2.9 billion. Deribit is a leading crypto-derivatives platform, and the deal signifies Coinbase’s push to deepen its international footprint and expand product offerings beyond spot trading.
Broader Crypto Market Lifted
Tuesday’s move rippled across digital-asset markets—Bitcoin surged past US$104,000, nearing its January all-time high, as traders anticipated fresh institutional buying would boost the sector’s overall market capitalization toward US$8 trillion by year-end. Analysts warn, however, that while index inclusion confers legitimacy and capital, it may also subject Coinbase to traditional shareholders’ performance pressures, potentially tempering its pace of innovation.
Looking Ahead
Coinbase’s S&P 500 debut cements its role as the premier bridge between Wall Street and Web3. Yet as US$9 billion in passive demand floods in, the company faces a strategic crossroads: balancing institutional expectations against its decentralized DNA. Whether this milestone ushers in a sustained bull phase—or signals the start of a new era of regulatory domesticity—remains the central question for investors and the broader crypto ecosystem.
