Coinbase beats earnings forecasts but users and transactions drop

Revenues fell almost 75% compared to the previous year, and it is that the crypto winter collapsed the price of cryptocurrencies. The company also posted a net loss (unadjusted) of $557 million, a year after generating net income of $840 million during the peak of cryptocurrency adoption.

Coinbase transactions drop

Among other problems that the company faces is the number of users that it has been reducing quarter by quarter. The company explained that had 8.3 million monthly users (MTUs) during the fourth quarterbelow the 8.5 million of the previous period and the estimates of analysts, who expected a base of 8.22 million.

Trading volume also fell 9% compared to the previous quarter, up to 145,000 million dollars, while Transaction revenues sank to $322 million, down 12% than in the third quarter and also below what was predicted by the consensus, which pointed to US$327 million.

Likewise, Coinbase explained that subscription and service revenues grew 34% quarter-on-quarter to $283 million in the fourth quarter. Subscriptions and services accounted for nearly 50% of total revenue in the fourth quarter, driven mainly by interest income, which totaled $162.2 million.

What is the expectation for this year?

In the presentation of results, the cryptocurrency exchange clarified that despite the improvement that cryptocurrencies had since the beginning of the year, these gains cannot be extrapolated for all of 2023 because last year it became clear that the market can change rapidly.

The company also claimed that expects more regulation of cryptocurrencies, both in the US and abroad, and that he hopes to benefit from it. As evidence of progress, he cited the completion of the European Union’s MiCA framework, as well as other countries such as Brazil, the United Kingdom, and India, which have drafted specific and clear legislation to regulate cryptocurrencies.

On the other hand, there was also criticism of a “disjointed” approach in the US in regulating the world of cryptocurrencies, although he assured that they continue to work with the institutions to achieve a more coherent and clear policy. “Politics is my top priority this year,” Coinbase CEO Brian Armstrong said during a call with analysts, adding that “there’s a lot of excitement about the potential of this technology and there’s a lot of desire for people to build this.” here in America.”