Coinbase beats expectations on renewed cryptocurrency momentum

  • COIN.us
    (${instrument.percentChange}%)

Coinbase Global (COIN.us) reported results after yesterday's close, posting well above Wall Street expectations. Revenue was $954m and EPS was $1.04. Expectations according to FactSet was for 2 cents per share in earnings and revenue of $826m.

COIN.us benefitted from a renewed momentum in the cryptocurrency market. Bitcoin, trading near $52,000 on Thursday, has more than doubled from a year earlier, surpassing a total market value of $1 trillion. Despite a 4.6% dip in Coinbase stock this year until Thursday's close, the company has still seen a significant climb of about 150% over the last 12 months.

Coinbase's trading volume more than doubled to $154 billion in the last half of 2023. Retail traders amounted to nearly 20% of this, with institutions contibuting the vast majority, especially active during times of high crypto volatility. This surpassed analysts' expectations of $142.7 billion in overall volume.

Coinbase holds Bitcoin on behalf of the majority of incoming funds, earning fees in return. However, the introduction of ETFs brings about possible hurdles for the company, as numerous investors may perceive them as a more economical alternative to purchasing Bitcoin directly from the trading platform. Coinbase CEO Brian Armstrong is optimistic here. He believes many investors will explore various facets of the crypto world beyond Bitcoin, creating opportunities for Coinbase to offer additional services.

COIN.us shares jumped near 14% in yesterday's extended session.

Coinbase is still facing SEC allegations of operating as an unregistered securities exchange. The company is challenging the charges, with a judge expected to rule on the need for a trial in the coming weeks.

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Russell Shor

Senior Market Specialist

Russell Shor joined FXCM in October 2017 as a Senior Market Specialist. He is a certified FMVA® and has an Honours Degree in Economics from the University of South Africa. Russell is a full member of the Society of Technical Analysts in the United Kingdom. With over 20 years of financial markets experience, his analysis is of a high standard and quality.

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