Market Recovery Drives Strong Performance, Coinbase’s Q1 Exceeds Expectations
In addition to cryptocurrency prices, the operational status of exchanges serves as a true “barometer” for the crypto market. Coinbase, the US cryptocurrency exchange, has released its Q1 2024 financial report. The overall market rally, coupled with the Bitcoin spot ETF, has led to significant growth for Coinbase, with both revenue and profit surpassing expectations and delivering impressive results.
Coinbase is the first publicly traded cryptocurrency company in the US and the largest cryptocurrency exchange in terms of trading volume. According to the company’s report, Coinbase’s total revenue for Q1 is approximately $1.6 billion, exceeding analysts’ expectations of $1.3 billion. Net income is $1.2 billion, and adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) reached $1 billion, showing growth compared to the same period last year, which was $977.5 million.
However, due to the rapid increase in cryptocurrency trading volume, consumer trading volume has surged by 93% compared to the previous quarter, forcing Coinbase to increase its expenses to maintain its trading infrastructure.
Interestingly, Coinbase has uploaded its earnings results as NFTs, allowing anyone to view Coinbase’s latest financial performance by minting these NFTs.
Further reading:
【Infographic】Is it Spring for Cryptocurrencies? Coinbase Reports First Profitable Quarter, 45% Growth in Q4 Net Income
Q1 Highlights: Significant Growth in Institutional and Consumer Trading Revenue
Coinbase’s revenue and profit mainly come from “transaction fee income,” which includes transaction fees from both retail investors and institutional investors. Other revenue comes from “subscription and service income,” such as blockchain mining and custody service fees. Therefore, market sentiment will greatly impact the company’s profitability.
Since the beginning of this year, the US approved the issuance of a Bitcoin spot ETF, followed by a surge in the Bitcoin and cryptocurrency market. Overall trading volume has increased significantly compared to the same period last year, which has also driven Coinbase’s transaction fee income to soar.
In Q1, Coinbase has indeed seen growth in both types of “trading revenue” and achieved good results.
The business of retail investors is the main source of revenue for Coinbase, generating over $935 million in revenue, a growth of 99% compared to the previous quarter.
Institutional trading revenue has grown by 113% compared to the previous quarter, reaching $85 million. In addition, the trading volume and active customer count of Coinbase Prime, the main broker solution for institutional investors, increased by 105%, reaching $256 billion, setting a new record.
Coinbase stated that the Bitcoin ETF and the strong market conditions in Q1 have attracted more investors, with nearly 40% of institutional clients using at least three platform products in the first quarter.
Furthermore, “subscription and service income” reached $510 million, a 41% increase compared to the same period last year’s $361 million, indicating that Coinbase is continuously expanding its sources of revenue beyond transaction fees.
Coinbase’s Q1 performance is impressive, and the company also mentioned that it has already generated over $300 million in transaction revenue in April, with an estimated subscription and service income of $525 million to $600 million for Q2.
References:
cointelegraph, Bloomberg, theblock