Coinbase's New Trading Engine

Due to new information that came to light (explained in "Touch Grass"). I have temporarily gotten out of AERO, marking this post as complete with a possibility to be re-activated. Final results were $0.68 to $0.785 (+15%).

With Bitcoin on the verge of breakout and Ethereum looking good for the first time in years, I have to look for tokens that are undervalued and can outperform these two. While I am allocated to small caps (sub-$200m), as well as the usual large caps, I must think of mid-caps to balance things out—especially ones worthy of a substantial 10% allocation.

Idea Snapshot

• Token: AERO
• General Thesis: Undervalued dominant exchange on Base that will get volumes directly from the 100m+ Coinbase users this year as they unlock onchain trading in-app.
• Risk Level: Medium
• Potential Upside: 400%+

The Business of Exchanges

CZ (Binance Founder) once said: “If I had any clue where price was going I wouldn’t have built an exchange.”

Exchanges are arguably the most profitable businesses in crypto. Whether prices go up or down, people trade, and exchanges earn fees. We've seen this demonstrated across three standout assets: HYPE (Hyperliquid), COIN (Coinbase), and HOOD (Robinhood)—all of which are notably up year-to-date, bucking broader market trends.

Aerodrome isn’t new or unknown, in fact I previously made money on this token. I bought it in February 2024 around the time we launched 0x100x on Instagram (The Club didn’t exist back then), bought it around $0.20 and sold it at $1. But back then AERO was going up because of “Base is a new chain” hype, now it’s more of a fundamentals bet. As much as I like trading attention I also like investing in the traditional sense (buying undervalued assets), it’s like channeling my inner Warren Buffett.

Why AERO is Undervalued

In finance, everyone is obsessed with “multiples”. For stocks most look at the PE ratio (price to earnings) which is the multiple at which price trades relative to what each share has in earnings.

I like to simplify things. When I am make an investment, I care about the valuation at which I am buying and what multiple that valuation is relative to revenue.

Currently, Aerodrome trades at an FDV of roughly $1.16 billion, generating around $134 million in annualized revenue. This equates to an 8.6x revenue multiple—significantly undervalued compared to peers:

• HYPE: 54x revenue
• Robinhood: 25.6x revenue
• Coinbase: 13.1x revenue

Even adopting Coinbase’s conservative multiple indicates at least 60% immediate upside. Matching Robinhood’s multiple would imply over a 3x return. That means AERO is undervalued today, let alone Coinbase enabling in-app onchain trading for their 100m+ users.

Estimating Growth

The first box to check for me is: “Is the price I am buying at right now undervalued based off their current financials?”. That’s checked, now I need to estimate future revenues to determine my exit price.

Upcoming Catalyst: Coinbase will enable their users to trade onchain tokens directly from the app, this unlocks new capital flows for Base. And, Aerodrome has ~60% dominance over Base trading volumes, so the biggest benefactor from that catalyst is AERO.

Now for the final valuation (FDV) and token price I will use the middle number from Robinhood (Valuation = 25.6 x Revenue). This outputs:

• Bear Scenario: $3.54b FDV or $2.11 per token (3.1x)
• Base Scenario: $3.91b FDV or $2.33 per token (3.4x)
• Bull Scenario: $5.49b FDV or $3.27 per token (4.8x)

These are measured from a current price of $0.68.

Strategy

Note: The purpose of sharing this section is education, not copying. This is not investment advice.

• Will DCA (dollar cost average) 10% of portfolio into AERO over 4 weeks (once per week) as I don’t believe the Coinbase integration happens before that.
• 50% of the tokens will be locked for 6-months as veAERO for yield.
• 50% will be sold at $1.4 (2x) to recoup initial investment, keeping the rest for $3.27.
• In the event of AERO sliding under $0.40 I’ll sell it all to limit my risk to 4% of portfolio only.

Bottom Line

Exchanges make most of the consistent money in finance, we’ve seen how HYPE surged (and I believe it continues to do so) and we’ve seen COIN and HOOD’s performances, AERO is the “new kid on the block” that will route most of the onchain orders for Coinbase traders. Good enough reason for me to buy and the current price is undervalued.

This is a slower cook, it will depend on BTC and ETH and while no one can guess timelines but if I had to pick I'd say it will likely take ~6 months.

FAQ

Q: Where can I buy AERO?

A: The token trades on Coinbase, Bybit, MEXC and a few other centralized exchanges. To buy it onchain you need to bridge ETH/USDC to Base and then buy it on Aerodrome.Finance. Only buy AFTER doing your own research, don't buy because you saw a ticker in a post.

Q: How do I stake AERO for veAERO & what are the pros / cons?

A: On Aerodrome’s website → “Lock” tab → “Create Lock” and choose period between 1 Day and 4 Years. The pros are that you receive 30 % of protocol fees + bribes (historically 20‑60 % APR), the cons are that you’re Illiquid until lock expires, emissions dilute unlocked holders and early exit requires OTC sale of veAERO (very hard).

Q: Why AERO instead of another AI‑Agent token?

A: Balance. I already have exposure to AI Agents, Internet Capital Markets and Large Caps. For you to make a decision you need to analyze your own holdings (and DYOR), the advantage you now have is that you know the ins and outs of AERO. Even if you’ve heard of the token before, you likely didn’t know all of that.

Q: How does Aerodrome differ from Uniswap?

A: Think of Uniswap as a general‑purpose marketplace that exists on many different blockchains, while Aerodrome is a specialist that focuses only on Base. Because Aerodrome lives on a single chain it can afford to add extra features—like letting its token holders decide where new rewards go and paying them a share of trading fees. Uniswap doesn’t share fees with its UNI token holders and, until its next upgrade (v4), projects can’t easily pay for deeper liquidity. That incentive layer is why new tokens launching on Base choose Aerodrome first—it’s the easiest place to “seed” deep liquidity quickly.

Q: What are the key risks to monitor?

A: Base growth stalls, Uniswap v4 hooks siphon volume via fee rebates, smart‑contract exploits on Aerodrome/core AMM, regulatory hits on CEX ↔ DEX routing and emission dilution if fee growth lags token issuance.

Q: Will Coinbase users actually care and buy on‑chain tokens?

A: Yes. The list of tokens you can buy on Coinbase is limited and usually exchange listings come too late. People want to access these tokens early-on (like many of you), and onchain is the only way. Plus, new tokens will launch on Base purely because of this new userbase.

Disclaimer: Nothing here is financial advice—just brain sparks from a random (but not your average) Instagram page.

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