Half a year has passed—how are the U.S. second-tier crypto exchanges doing?

Market share is being steadily squeezed.
By Eric, Foresight News
By the half-year point in 2026, the crypto market hasn’t delivered the rebound many people were hoping for. Bitcoin is down more than 30% in the first half, at one point falling below $60,000, and trading volumes across the spot market have shrunk by more than 20% for two consecutive quarters. The (CLARITY Act), once expected to be a breakthrough, stalled in the Senate. Expectations for regulatory easing have also been pushed back.
Coinbase has turned a report card of more than a $750 million six-month loss into a tangible, chilling reality. If that’s the situation for a leading U.S. cryptocurrency exchange, days for second-tier exchanges are even tougher. According to the recent second-quarter disclosures, while some second-tier exchanges have achieved growth in performance, their market share continues to be squeezed.
Gemini—kept alive by founder funding
First, let’s talk about the worst-off one.
In Q2, Gemini’s total revenue was $45.5 million, up 37% year over year, but exchange revenue fell 38% year over year to just $12.5 million. Spot trading volume shrank from $11.3 billion in the same period last year to $3.8 billion, down 66%. Revenue growth is powered entirely by side hustles such as credit cards, staking, and OTC—credit card revenue was $16.2 million, up 231% year over year.
Gemini posted a net loss of $107.7 million in Q2, and accumulated losses of $217 million in the first half. Platform assets fell from $18.2 billion a year earlier to $8.4 billion. Worse still, the credit card business stepped on a landmine: identity fraud discovered in Q1 continued to develop in Q2, leading to a provision for trading loss reserves of $20.1 million in the quarter.
The contraction came fast and hard. On February 5, Gemini announced it was exiting the UK, the EU, and Australia, effectively giving up its overseas footprint built over many years. The company cut 40% of employees from the peak in Q3 2025, leaving only 402 at quarter-end, and cut marketing expenses by 45% year over year. In May, the Winklevoss brothers funded the company with $100 million out of their own pockets via their funds at a price of $14 per share. Founder-at-a-premium additional buying sounds like a vote of confidence, but the signal the market reads is: this company can no longer raise money externally. This lifesaving cash paid in Bitcoin then ran into a decline in the coin’s price, resulting in an impairment recorded on the books, which dragged adjusted EBITDA for Q2 straight to a negative $74 million—worse than Q1.
Stock price is the most honest vote. Gemini listed at $28 in September last year, surged to a day-high of $45.89, and is now down more than 88% from that peak, with a 56% decline year to date. In April, Citigroup cut its target price to $4 and maintained a sell rating.
Bullish—its financial statements held hostage by Bitcoin
Bullish’s situation is a bit more complex. Besides an exchange, the company also has CoinDesk media, index licensing, and the Consensus conference, so its revenue mix is relatively diversified.
Bullish’s adjusted revenue in Q2 was $92.6 million, up 62% year over year. Subscription and services revenue hit a record $62.7 million, and Morgan Stanley and Grayscale are using CoinDesk’s indices to launch products. Adjusted net profit in Q2 was $14.3 million, turning from loss to profit year over year. Judging only by these numbers, Bullish looks like the most respectable second-tier player.
But IFRS-based financial statements tell another story. The company recorded a net loss of $280 million in Q2, mainly due to fair value impairment of $245 million in Bitcoin held in its treasury vault, all in Q2 alone. Digital asset sales fell 44% year over year, indicating that institutional trading business is shrinking as well.
The CEO, Tom Farley, offered an answer of fully switching tracks. In May, Bullish announced at Consensus Miami that it would acquire securities registrar and transfer agent Equiniti, with deal size of about $4.2 billion. It expects completion in early 2027 and aims to assemble the full chain for tokenized securities—from issuance, listing, trading, and tracking. On August 12, the company launched its own tokenized stock trading platform and also received approval from Gibraltar’s regulator.
The story is a popular one, but capital markets aren’t buying it right now. Bullish went public in August last year at $37, closed its first day at $70, and its share price now sits between $23 and $27—down more than 30% below the offer price, and down about 35% for the year. Zacks issued a sell rating after the earnings report.
eToro and Bakkt have largely given up on crypto trading
eToro turned in a solid performance: net profit in Q2 was $229 million, up 9% year over year. Adjusted EBITDA was $78 million, profit margin 34%. The company has $1.2 billion in cash on the books, and it also repurchased $87 million worth of stock.
But this crypto trading–known financial trading platform is gradually moving back to its core business. In Q2, eToro’s net trading contribution from its crypto business was only $11 million, and it also included a $2 million impairment related to the company’s own coin holdings. Meanwhile, traditional asset categories—stocks, commodities, and foreign exchange—contributed $142 million, up 25% year over year. In fact, in Q1, eToro’s commodity trading accounted for 60% of commission income, and trading volume was up nearly fourfold year over year.
Capital markets also gave it a relatively fair treatment. eToro’s share price rose about 17.6% this year and outperformed the S&P 500. After the earnings report, TD Cowen cut its target price from $55 to $35. In July, eToro announced it would acquire the broker TradeZero for up to $230 million, continuing to move toward the direction of U.S. retail brokers.
eToro’s significance lies in the fact that it proves the lifeline for second-tier players isn’t improving the exchange business—it’s not running an exchange anymore.
In 2025, Bakkt sold off its loyalty and trust business. It went all in on crypto infrastructure and stablecoin payments, completing the acquisition of DTR in April. The story is a B2B narrative of combining a regulated license with stablecoin settlement.
Bakkt’s revenue in Q2 was $170.1 million, down 70% year over year. That $170.1 million in revenue corresponded to costs of $169.3 million, leaving almost zero gross profit. In the first half, Bakkt handled a total crypto trading volume of just $410 million, while management kept its full-year guidance at $2.5 billion unchanged—meaning the second half must achieve five times the volume of the first half.
If eToro delivered the correct answer, Bakkt is completely the opposite. The planned new business still has no momentum, and the highest-share crypto trading segment has essentially bottomed out.
First-tier exchanges continue to grab market share
Coinbase’s first half is also ugly. Q1 revenue was $1.41 billion, down 31% year over year, with a net loss of $394 million. Q2 revenue fell to $1.2 billion and the company lost another $360 million, missing Wall Street expectations for three consecutive quarters. In May, Coinbase announced layoffs of 700 people, 14% of its total employees.
But among all this, two numbers are worth noting. In Q1, Coinbase’s share of global crypto trading volume hit a record high of 8.6%. In Q2, that number was refreshed again to 10.3%, rising for three straight quarters. Total market size is shrinking while market share is rising—this means the cost of contraction is being passed on disproportionately to second-tier players. Gemini’s spot volume fell 66%, Bullish’s digital asset sales dropped 44%, while Coinbase’s trading revenue declined far less than the industry overall.
The phenomenon of resources concentrating at the top is becoming even more obvious. Coinbase’s adjusted EBITDA in Q2 was still $208 million, positive for 14 straight quarters. Stablecoin revenue was $292 million in the quarter, and within less than half a year of the prediction market going live, it already generated $100 million in annualized revenue. For the same kind of new business, Gemini’s prediction market revenue was $500,000 in Q2. In a bear market, scale itself is the moat—liquidity, brand, and compliance cost dilution abilities all concentrate at the top.
Conclusion
Putting four earnings reports side by side makes the survival picture for U.S. second-tier exchanges in the first half very clear. Trading volume is concentrating on Coinbase, and their core-business revenue collapses at a rate of 40% to 70%. Their transformation directions are surprisingly consistent: credit cards, prediction markets, stock trading, tokenized securities, stablecoin payments—everything is tried, but no longer do they count on spot trading fees.
eToro proves diversification can survive. Bullish is betting on a tokenized future that won’t settle until 2027. Gemini retreats to its home base in the U.S., relying on founder funding. Bakkt is supporting the potential of its stablecoin business with a 70% revenue drop. If the crypto market doesn’t rebound in the second half, we may continue to see ongoing declines across various categories of numbers.
For second-tier exchanges, the challenge for 2026 was never growth—it was survival.