Coinbase Earnings Outperform Expectations

Transaction revenues doubled from the previous quarter, pushing COIN stock to a new local high.

Coinbase's trading volumes have picked up as users sought to front-run institutions on ETF hype.

As the crypto markets have recovered and trading volumes pick up, the level of activity experienced by Coinbase has increased revenues, smashing analysts' expectations.

Transaction revenues have doubled from the previous quarter. Expectations were that COIN would earn just $0.02 per share, but the reality was $1.04. Shares soared on the news, hitting a near two-year high at $185 in pre-market trading.

Coinbase's share price remains far below its IPO levels, when it briefly topped $420, but have made a very strong recovery over the past year. COIN bottomed at just $32 in January 2023, and has therefore staged an almost 500% rally, outperforming bitcoin. Total revenues for 2023 were over $3 billion.

ETF Hype

Expectations around the ETFs have been a major part of the return of trading volumes, as traders and investors sought to front-run institutional entry to the crypto space. However, because these are Q4 results, and the ETFs only launched in January, they do not directly factor into the figures.

Coinbase has been one of the key beneficiaries of the ETFs, since it is the custodian of choice for the majority of providers. The exchange's OTC desk also processes orders, and has been converting billions of dollars into BTC for these TradFi traders over the past month.

Overall, however, retail trading still makes up the largest part of the exchange's business. Q4 volumes totaled $154 billion.

Industry Leader

As well as being a trading powerhouse, Coinbase has been positioning itself as an industry leader over the past year or more. It has taken proactive measures against the SEC, taking the regulator to court to compel the agency to provide the clarity that US crypto businesses desperately need.

Coinbase’s Legal Action Against The SEC Continues After Rulemaking Petition Denied
The SEC claims existing laws cover the crypto sector adequately.

Additionally, they have started a political movement, seeking to mobilize America's tens of millions of crypto holders to put pressure on Congress and secure more favorable treatment for crypto businesses, users, and the industry as a whole.

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