- Coinbase beat market expectations, with Q2 revenue hitting $1.45 billion.
- ETF cannibalization could affect Coinbase's future earnings.
- COIN, BTC and ETH showed a slight increase as the report was largely positive.
Coinbase (COIN) is down 5% on Thursday after announcing a strong Q2 earnings report that surpassed market expectations. The company's positive Q2 report led to a slight rise in Bitcoin (BTC) and Ethereum (ETH).
Coinbase earnings beat expectations, but profit lags
Coinbase announced positive Q2 earnings on Thursday as its revenue rose to $1.45 billion, beating market expectations of $1.39 billion.
Coinbase's total trading volume was $226 billion, down 28% quarter-on-quarter (QoQ). As a result, its total transaction revenue also declined QoQ to $781 million. While overall revenue declined, revenue from subscriptions and services showed strong growth, coming in at $599 million, a 17% QoQ rise.
However, Coinbase's net income dropped considerably from $1.2 billion in Q1 to $36 million in Q2.
The Base Layer 2 is also becoming a core part of Coinbase, growing 300% QoQ to become the number one L2 in transactions processed. Base's median daily fee of $0.01 per transaction largely contributed to this rise.
Other notable trends from the report include:
Coinbase Q2 earnings
Crypto market investors generally use Coinbase earnings reports as a proxy to gauge US investors' interest in the crypto market. However, the outlook is gradually changing with Coinbase's increasing quest to diversify revenue sources and a potential ETF cannibalization with the launch of spot Ethereum and Bitcoin ETFs.
Considering Ethereum and Bitcoin make up a large portion of Coinbase's trading volume and transaction revenue, US investors shifting their trading activities towards ETFs could affect its revenue, noted Quinn Thompson, founder of Lekker Capital.
COIN is down 5.22% on the day but showed positive strength before the market closed. Following its decline, Cathie Wood's Ark Invest sold $2.7 million before Coinbase's earnings report. This adds to its earlier $4.3 million offload of COIN on July 19.
Meanwhile, the crypto market gained slightly after Coinbase's positive report. Bitcoin reclaimed $65,000, and Ethereum rose above the $3,200 mark as they attempted to shrug off bearish sentiment about the Federal Reserve's decision to keep interest rates steady.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended Content
Editors’ Picks
Coinbase Q2 earnings beat expectations as crypto market posts signs of potential recovery
Coinbase beat market expectations, with Q2 revenue hitting $1.45 billion. ETF cannibalization could affect Coinbase future earnings. COIN, BTC and ETH showed slight increase as the report was largely positive.
Ethereum declines amid ETH ETF outflows and potential whale dump
Ethereum ETFs recorded $77.3 million in net outflows on Wednesday. Wallet related to Elwood Technologies has moved 19,500 ETH to Binance within the past two days. Ethereum could bounce off key support level to set new yearly high.
Bitcoin, crypto may rebound in August: Insights from Santiment's July roundup
The crypto market closed July with a sharp rise in Bitcoin's weighted sentiment, indicating increased bullish sentiment toward the top cryptocurrency, especially as it approached the 70K key psychological level.
Ripple makes a strategic move, while SEC cancels closed-doors meeting, XRP bleeds
Ripple announced the arrival of tokenized US Treasury bills on the XRP Ledger in an official tweet on X. XRP trader sentiment turns to fear on the Fear and Greed Index on CFGI.io. XRP erases recent gains, suffers nearly 7% decline on Thursday.
Bitcoin: Will BTC manage to recover from recent market turmoil?
Bitcoin recovers to $67,000 on Friday after finding support around $63,500 a day before. Still, BTC losses over 1.50% on the week as Mt. Gox persists in transferring Bitcoin to exchanges.