Though subdued, it was a positive all-round performance for the crypto market in Q2 2023.
Following a minor crypto market rally, several crypto-focused companies have recorded an increase in revenue. MicroStrategy, Coinbase, Coinshares, Block, and Robinhood all posted record profits in Q2 2023 despite the general macroeconomic downturn.
MicroStrategy Invests in More Bitcoin to Beat the Market
MicroStrategy became profitable in Q2 2023 as Bitcoin (BTC) prices surged. The company increased its BTC holding by 12, 333 BTCs in just the second quarter. This brought its total BTC holding to 152,800.
“We efficiently raised capital through our at-the-market equity program and used cash from operations to continue to increase bitcoins on our balance sheet,” said Andrew Kang, Chief Financial Officer of MicroStrategy.
Consequently, MicroStrategy recorded a gross profit of $93.3 million, representing a 77.5% gross margin. It also reported minimal operational loss, ensuring its balance sheet remained positive.
According to the earnings report filed on Aug.1, MicroStrategy earned $22.2 million in net income. Comparatively, the firm made a gross profit of $96.9 million in Q2 2022 and a net loss of $1.1 billion.
Coinbase Remains in Loss Despite Crypto Market Rally
Meanwhile, Coinbase posted total revenue of $707.9 million in its Q2 2023 report. While it was down from $772.5 in Q1 and $808.3 million in Q2 2022, it still exceeded estimates. Also, the exchange recorded $335.4 million of net revenue from its subscriptions and services.
“One year ago in Q2 2022, we started reducing our expense base to operate more efficiently. One year later, we’re proud to say that our quarterly recurring operating expenses have dropped nearly 50% Y/Y,” the company noted.
Following its Q2 2023 earning report, Coinbase shares rose to $96.70, gaining 7%. The stock is up 170% year-to-date.
Is the Crypto Winter Effectively Over?
Though subdued, it was a positive all-round performance for the crypto market in Q2 2023. This has caused analysts to speculate that the crypto winter is over. As if to confirm this, the Nasdaq Crypto Index (NCI) increased by 6.3% quarterly (74.3% YTD), with Bitcoin leading the way by with more than 7% growth.
According to Hashdex, several factors combined to make the quarterly crypto market rally possible. On one end, Ethereum successfully activated Shanghai. Later, Ripple won its long-standing brawl against the SEC. On another front, BlackRock (followed by Fidelity, Invesco, WisdomTree, VanEck, Nasdaq, and Ark) applied for a spot Bitcoin ETF in the US and got accepted.
Whether or not the crypto winter is over will depend on how Q3 pans out for many more of these companies.
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