By
Godfrey Benjamin
April 23rd, 2024
While some companies are complaining about their unsatisfactory performance in 2017, digital exchange Coinbase revenue outperformed all the expectations.
As it has become known one the largest platforms for buying and selling cryptocurrencies Coinbase made more than $1 billion in revenues last year.
At the end of September the six-year-old company Coinbase expected to generate just $600 million in annual sales. But the achieved results mean that the company has exceeded its 2017 revenue forecast by 66 %.
Nevertheless, unpredicted factors played into the hands of the America’s largest cryptocurrency exchange: enormous interest in Bitcoin and other cryptocurrencies in November-December led to a skyrocketing demand for the company’s services toward the end of the year.
Coinbase is reported to add 100 000 users in just three days after the US Thanksgiving holiday period. Some other exchanges even were forced to stop welcoming new traders due to such rush of demand. But Coinbase was able to manage with it. The platform had over 13 million users by December.
Bitcoin that is traded at press time at $10,370.30 according to the data of CoinMarketCap (which is twice less than in December) is altogether worth about $175 billion in market value. But Bitcoin’s price is not the only source for the company’s revenue. The Coinbase’s income depends on the volume of trades as well.
During the last month of the year cryptocurrency trading volumes held steady above $25 billion a day. Coinbase, which makes money charging buyers and sellers a fee of between 0.25 % and 1 % to trade virtual currencies, appears to be one of the beneficiaries of this rising demand for crypto investments.
In spite of the fact that the interest of external investors continues its growth, the company remains private not letting its stocks be traded on secondary markets. One of the reasons for that is a lack of full and equal information available to the market.
Investors are willing to purchase shares in the company. But in August 2017, Coinbase raised $100 million in a series D funding run aimed at strengthening its engineering and customer service teams and opening a new office in New York. Those investors who didn’t take their chance at that time will probably have the only choice – to wait until the company decides to raise another round of funds.
Coinbase has always been famous for its recruitment policy of hiring experienced staff. In its team there are such professionals as Twitter executive Tina Bhatnagar, former top executive at Hewlett-Packard and TD Ameritrade Asiff Hirji and vice president of messaging products at Facebook and former president of PayPal David Marcus.