Coinbase, the cryptocurrency exchange that’s been making headlines for all the right reasons, has just posted its strongest quarter of earnings in over a year. And guess what? It’s all thanks to the election of US President Donald Trump. Yes, you read that right!
According to Coinbase’s Feb. 13 financial results, the firm hit total revenue of $2.3 billion, while net income was a whopping $1.3 billion. Both figures far exceeded analyst expectations. Trading volume reached a staggering $439 billion in the fourth quarter, beating estimates of $404 billion. 💰
Consumer transaction revenue increased over 178% quarter-on-quarter to $1.35 billion, while institutional revenue increased 155% over the same timeframe to $141.3 million in Q4. This quarter was highlighted by US President Donald Trump’s election win and rising market prices. 📈
“The majority of the Y/Y growth in Trading Volume was driven by higher levels of Crypto Asset Volatility — particularly in Q1 and Q4 — as well as higher average crypto asset prices,” said the firm in a shareholder letter.
Coinbase also recorded $225.9 million and $214.9 million in stablecoin revenue and blockchain rewards revenue — the latter of which marked a 38.8% quarter-on-quarter increase. 💸
Coinbase (COIN) shares saw some volatility in after-hours trading and are currently down 0.88% after hours to $295.01, Google Finance data shows. However, Coinbase shares increased 8.44% to $298.1 during the Feb. 13 trading day.
Coinbase’s earnings come a day after online brokerage firm Robinhood posted a banner quarter, which saw shares rise as its Q4 earnings beat consensus estimates and cryptocurrency revenue jumped 700% year-on-year. 🎉
Post-election volume surge
Crypto research firm Coin Metrics forecasted Coinbase’s revenue to jump over 100% year-over-year, driven by a rise in trading volumes in Q4 2024. The increased trading activity has been “fueled by renewed market optimism post-U.S. election,” Coin Metrics said.
US President Donald Trump has promised to make America “the world’s crypto capital” and has nominated pro-industry leaders to head key agencies. 🇺🇸
The trading volume largely comes from institutions as Coinbase continues to grapple with a drought in retail investor activity, crypto researcher Kaiko said on Feb. 10. 🏦
Subscriptions and services
In 2024, Coinbase significantly increased revenues from subscriptions and services, but the exchange “remains a trading platform at its core, with trading still accounting for […] more than 50% of revenue,” according to Kaiko.
Meanwhile, analysts anticipated seeing growth in Coinbase’s emerging subscriptions and services businesses. In Q4, the supply of the US dollar-pegged stablecoin USDC (USDC) on Coinbase grew by approximately 23%, a tailwind for the exchange’s stablecoin revenue, Coin Metrics said.
Coinbase’s Ethereum staking platform — another lucrative services business — has struggled to grapple with a general decline in ETH stakers, clocking a net outflow of nearly 1.3 million ETH in Q4, Kaiko said.
In the long term, a friendly US regulatory environment under Trump stands to benefit Ethereum’s staking business, researchers said. 🌟
“We see Coinbase as a beneficiary of the election results as the firm has been struggling with regulatory pressure from the SEC,” Michale Miller, an equities researcher at Morningstar Inc., said in a November research note.
Additional reporting by Alex O’Donnell.
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2025-02-14 02:02