In a notable development for the cryptocurrency sector, investment bank KBW has initiated coverage of Bullish, the owner of CoinDesk, with a market perform rating and a $55 price target. The bank’s analysis suggests that Bullish is a unique public investment opportunity, given its positioning as a highly regulated, institution-first cryptocurrency exchange. The anticipated expansion into the U.S. market is seen as a key catalyst that could drive substantial growth for the company.
U.S. Expansion: A Catalyst for Growth
The investment bank’s optimism about Bullish’s prospects largely hinges on its planned entry into the U.S. market. The move is expected to be a game-changer for Bullish, allowing it to tap into one of the world’s largest and most lucrative markets for cryptocurrency trading. Analyst Bill Papanastasiou from KBW emphasized that Bullish’s differentiated technology stack and competitive fee structure, coupled with its deep liquidity, position it well to gain significant market share.
Bullish’s regulatory footprint is already impressive, with licenses in Germany, which comply with the Markets in Crypto-Assets Regulation (MiCAR), as well as in Hong Kong and Gibraltar. These credentials have not only attracted institutional traders but have also enabled Bullish to maintain a global order book that effectively links Asian and European markets. This strong regulatory foundation is expected to be a significant advantage as Bullish seeks to establish itself in the U.S.
Building on a Strong Foundation
Beyond its primary trading operations, Bullish has diversified its revenue streams through strategic acquisitions, including CoinDesk and CCData. This diversification is expected to make up over 40% of Bullish’s revenue by the fiscal year 2027, according to KBW. By building recurring revenue streams from data, indices, and liquidity services, Bullish is not only securing a stable financial footing but also positioning itself for long-term growth.
The acquisition of CoinDesk also provides Bullish with an opportunity to reach retail users, who typically offer higher margins compared to institutional clients. This optionality could prove to be a lucrative avenue for Bullish, particularly as retail interest in cryptocurrency trading continues to grow.
Regulatory Hurdles and Opportunities
One of the significant hurdles Bullish faces in its U.S. expansion is obtaining a New York BitLicense, a crucial regulatory approval that would allow it to operate in one of the most regulated and prestigious financial hubs in the world. While obtaining this license is seen as a milestone, KBW believes that Bullish’s national rollout will proceed regardless of the timing of this approval.
Bullish’s work with Gibraltar regulators on establishing a fully crypto-enabled clearinghouse further underscores its credibility as a market infrastructure provider. This initiative not only highlights Bullish’s commitment to regulatory compliance but also enhances its reputation as a reliable and innovative player in the cryptocurrency space.
Competitive Landscape and Market Potential
In the competitive landscape of cryptocurrency exchanges, Bullish’s lower take rates—1.6 basis points compared to approximately 3 basis points for Coinbase—are expected to be a significant competitive advantage. Coupled with its strong liquidity, this pricing strategy could enable Bullish to capture a larger share of the U.S. market, particularly as traders seek more cost-effective trading solutions.
Despite the neutral market perform rating, KBW acknowledges the potential upside if Bullish successfully executes its expansion plans and capitalizes on retail engagement. The shares were trading flat at around $51.81 at the time of publishing, reflecting a cautious optimism among investors.
Looking Ahead
The road ahead for Bullish is filled with both challenges and opportunities. The company’s ability to navigate the complex regulatory landscape in the U.S., coupled with its efforts to engage retail users and leverage its diversified revenue streams, will be critical determinants of its future success.
As the cryptocurrency market continues to evolve, Bullish’s strategic positioning and regulatory compliance could make it a formidable contender in the global cryptocurrency exchange arena. With its eyes set on U.S. expansion and a robust foundation in place, Bullish is poised for potential growth, provided it can deliver on its ambitious plans.
In conclusion, while the current neutral rating reflects caution, the potential for Bullish to emerge as a leading player in the cryptocurrency exchange market is undeniable. Investors and market watchers alike will undoubtedly be keeping a close eye on Bullish’s next moves as it seeks to capitalize on the burgeoning opportunities in the U.S. and beyond.
Steve Gregory is a lawyer in the United States who specializes in licensing for cryptocurrency companies and products. Steve began his career as an attorney in 2015 but made the switch to working in cryptocurrency full time shortly after joining the original team at Gemini Trust Company, an early cryptocurrency exchange based in New York City. Steve then joined CEX.io and was able to launch their regulated US-based cryptocurrency. Steve then went on to become the CEO at currency.com when he ran for four years and was able to lead currency.com to being fully acquired in 2025.
