Bitcoin Is Bouncing Back—Here are 2 Ways to Play the Rebound

Key Points

• Bitcoin has rallied more than 41% from its July 1 year-to-date low, fueled by institutional inflows and easing crypto winter conditions.
• Coinbase has climbed roughly 36% from its February low, and its new Crypto-as-a-Service platform has attracted partners like PayPal and PNC.
• Strategy's stock has surged nearly 91% from its June low, but its Bitcoin-heavy balance sheet makes it far more volatile than the S&P 500.

It’s been a trying year for crypto investors. Since Bitcoin (BTC) hit its all-time high (ATH) on Oct. 6, 2025, the coin and the industry have been in retreat. But since mid-summer, prices have rallied amid catalysts that have enthusiasts eyeing the end of crypto winter.

The largest crypto by market cap has staged a dramatic comeback. After hitting its year-to-date (YTD) low of $59,101.49 on July 1, BTC has gained more than 41%, leaving it down less than 5% in 2026.

As the rally continues, investors looking to gain indirect exposure via the equities market can consider two stocks that offer distinct approaches.

What’s Driving the Crypto Bounceback?

Bitcoin prices remain down nearly 24% over the past year, and are trading nearly 33% below their ATH. In part, the current crypto winter was the result of Bitcoin’s own success. After hitting its record high, BTC fell in unison with tech stocks in the very same market rotation that saw the Nasdaq sell off following the index’s own ATH in October 2025.

Traders embraced a rotation away from high-growth, high-risk assets, with emerging markets, underappreciated S&P 500 sectors like industrials and materials and small-cap stocks being direct beneficiaries.

But as with any market, crypto winters are natural, recurring functions, and the cycle appears to be easing. Historically, crypto bear markets have lasted around 13 months, suggesting the current downturn may be approaching a later stage. At the same time, a debasement trade fueled by record U.S. national debt and runaway bond yields is providing another potential tailwind for Bitcoin.

Other catalysts include surging institutional demand, which has rebounded after months of outflows. Spot Bitcoin ETFs recorded billions of dollars in inflows in August and September, while corporate treasuries and crypto whales absorbed market liquidity as summer wound down.

Bitcoin’s 2021–2022 downturn produced a smaller peak-to-trough decline than the two prior major crypto bear markets. During the 2014–2015 downturn, BTC fell from around $1,200 to around $170, a loss of roughly 86%. From 2017–2018, BTC declined from about $19,800 to $3,200, or roughly 84%. During the 2021–2022 crypto winter, BTC fell from nearly $69,000 to about $15,500, a decline of roughly 77%.

During this most recent instance, BTC lost roughly 52% from its ATH in October 2025 to its YTD low on July 1. Meanwhile, two stocks leveraged to the crypto trade have been steadily rising from their respective YTD lows, offering investors an equities market approach to crypto’s rebound.

America’s Largest CEX Is Staging a Comeback

As the largest U.S.-based centralized exchange (CEX), Coinbase NASDAQ: COIN has amassed a nearly $51 billion market cap.

The digital asset and crypto platform serves retail investors, institutional investors, developers and ecosystem partners.

Its offerings—including crypto custody, institutional prime brokerage and custody, staking services, a self-custody wallet, and tools that enable developers and businesses to build applications using blockchain networks—tend to experience higher demand when the crypto market demonstrates strength.

That was reflected by COIN’s performance, which can mirror that of BTC. Since its one-year high on Oct. 9—just five days after Bitcoin’s ATH—Coinbase has fallen by more than 50%.

But since its YTD low on Feb. 12, the stock has slowly inched back up, gaining around 36% since.

When the company reported Q2 earnings on July 30, it missed on the top and bottom lines. The earnings miss was its fifth in six quarters, while the revenue miss was its third consecutive and fourth in five quarters.

But Coinbase is evolving, making it an intriguing buy-low candidate.

Beyond serving as a CEX, the crypto firm launched its unified Crypto-as-a-Service (CaaS) platform on June 10, 2025. As a CaaS provider, Coinbase now allows banks, fintech companies, brokerages, and payment processing companies to integrate white-label crypto trading, custody, staking, and stablecoin payment rails. Major adopters include Webull NASDAQ: BULL, PNC NYSE: PNC, eToro NASDAQ: ETOR, and PayPal NASDAQ: PYPL.

The company is operating at a loss amid the crypto industry’s prolonged downturn, but Coinbase’s fundamentals have improved as Bitcoin bounces back. In Q2, revenue growth of negative 18.51% marked an improvement over Q1’s negative 30.54%. Additionally, Q2 free cash flow growth was nearly 65% quarter over quarter.

Coinbase receives a consensus Hold rating, but 20 of the 35 analysts covering the stock assign it a Buy rating. The $223 price target suggests more than 17% potential upside from current prices.

Institutional selling has subsided, while short interest of 11.48% remains elevated but is also improving.

Strategy’s Bitcoin Exposure Carries Significant Volatility

Strategy NASDAQ: MSTR is the world's first and largest publicly traded Bitcoin treasury company.

In 2020, MicroStrategy adopted Bitcoin as its primary treasury reserve asset, and the company rebranded as Strategy in February 2025.

Through equity offerings and debt financing, including convertible notes, Strategy has aggressively accumulated Bitcoin over the past five years. It has also tapped into cash flows from legacy operations—specifically in enterprise analytics and mobility software—to fund its BTC acquisitions.

The result is that MSTR’s performance closely resembles Bitcoin’s. Since their YTD low on June 26, shares have rallied nearly 91%. But to contextualize that, Strategy is down more than 56% from its one-year high on Oct. 6, 2025.

As a Bitcoin treasury company, Strategy can introduce exceptionally high volatility to holders’ portfolios, with its underlying fundamentals secondary in effect to Bitcoin’s performance. That extreme balance sheet concentration risk has materialized in a beta of 3.59, meaning that MSTR is currently 259% more volatile than the S&P 500.

Still, the stock receives a Moderate Buy rating and its $240 price target implies around 55% upside potential—reflective of BTC’s impact on its own performance.

Short interest has fallen dramatically to 8.56% of the float, while institutional selling—which spiked during the depths of crypto winter—has also relented.