Coinbase Global's (COIN) "softer" forward revenue outlook and uncertainty on the cryptocurrency backdrop suggest a weaker recovery than previously expected, Morgan Stanley analysts said in a Monday note.

Analysts reduced 2027 and 2028 revenue estimates for the company by 28% and 18%, respectively, driven by weaker retail and institutional spot volumes.

Morgan Stanley said Binance's major security breach presents another potential overhang for crypto-market confidence and activity.

"While we continue to view Coinbase as one of the best-positioned platforms in crypto, we see greater downside risk to earnings and valuation," analysts said.

Morgan Stanley downgraded the stock's rating to underweight from equal-weight and lowered its price target to $120 from $258.

Shares of the company were down over 1% in Monday trading.

Price: 142.02, Change: -1.52, Percent Change: -1.06