By
Godfrey Benjamin
April 25th, 2024
According to the chief investment officer at Coinbase, the crypto firm is venturing into the derivatives market in order to better serve the international customer base.
With a quarterly revenue of $736 million in Q1 2023, the popular cryptocurrency exchange Coinbase Global Inc (NASDAQ: COIN) smashed analysts’ expectations. According to FactSet, analysts expected Coinbase to announce revenue of $655 million in the year’s first quarter. The newly reported fiscal report also surpassed the 2022 Q4 revenue of $629 million. Coinbase shares increased by 8% to $53 at the close of the Thursday post-trading session, in reaction to the Q1 2023 financial performance. On a year-on-year scale, Coinbase shares have spiked by over 40% in conjunction with the rise of Bitcoin to approximately 74%.
Coinbase in Q1 2023
During the Q1 2023 reports, Coinbase announced an adjusted loss of $0.34 per share against analysts’ estimated loss of $1.45 per share, a significant drop from Q4’s loss of $2.45 per share. Coinbase generated $374.7 million from transactions and $361.7 from subscriptions and services. The company increased its net revenue by 22% quarter-over-quarter.
However, Coinbase performed lower than predicted in its trading volume during Q1 2023. While analysts expected $147.7 million, the company’s trading volume for the quarter came in at $145 billion. In the previous quarter, Coinbase traded about $146 million.
During a short interview, the CEO of Coinbase Brian Armstrong spoke about how the company has been faring financially.
“This is the fourth crypto cycle that Coinbase has been through and we’ve emerged stronger after each one. We’ve shifted the business to operate more efficiently in this down market driving positive adjusted EBITDA in Q1.”
Many investors are interested in the launch of the Coinbase derivative exchange in Bermuda. The new outlet outside the United States could positively impact the revenue generated. Notably, Coinbase pushed its operations outside the US due to the rampant crackdown on cryptocurrency exchange by financial regulators in the country.
According to Anil Gupta, the chief investment officer at Coinbase, the cryptocurrency is venturing into the derivatives market to serve the international customer base.
According to the chief investment officer at Coinbase, Anil Gupta, the crypto firm is venturing into the derivatives market in order to better serve the international customer base. He explained that the new ventures might not contribute significantly to the total revenue immediately but would in future quarters.
Coinbase Advocates for Fairer Crypto Regulations in the US
Recently, Coinbase has been one of the top US cryptocurrency exchanges seeking more explicit financial regulations in the country. In March, Armstrong said he would spend more time in Washington DC to advocate for a fairer crypto-related policy. He noted that the country is a leader in the cryptocurrency space and therefore needs to update its financial regulations. The crypto bull believes this would encourage the American cryptocurrency space to flourish and maintain its number one spot. Coinbase called out the SEC for providing insufficient regulatory guidance to US companies operating in the crypto market.
Though its US operation remains its primary business outlet, Coinbase aims to spread its tentacles to top countries like Canada, Singapore, and Brazil.