In its first revenue report after going public, Coinbase disclosed a total revenue of $1.8 billion
United States’ largest cryptocurrency exchange, Coinbase, has tripled its earnings from the last quarter of 2020 to the first quarter of 2021, documents filed with the US Securities and Exchanges Commission (SEC) revealed.
Coinbase, whose listing on the Nasdaq was hailed as a victory for all crypto advocates, generated $585 million in revenue this quarter as compared to a mere $191 million in Q1 of 2020. The boost in the company’s performance can be attributed to the recent Bitcoin bull run in particular, and the rising interest in cryptocurrencies amid the pandemic in general.
The public listing led Coinbase to generate $3.05 per share, leading to total revenue of $1.8 billion. This is short of the previously expected $3.07 per share, as the price of Coinbase continued to drop in early May when investors started questioning the company’s valuation.
Not surprisingly, over 94% of Coinbase’s net revenue this quarter was earned through the crypto-assets trading fee. Its net profits for the quarter stood at a whopping $771 million, almost four times its profits from the last quarter and an increase of 24x year-on-year.
Coinbase now boasts over 56 million verified users and more than 8000 institutional investors on the platform. Its Retail Monthly Transacting Users stands at over 6 million, a number that has doubled this quarter.
Speaking to its shareholders, Coinbase said that the strong Q1 results do not distract it from the challenges created by the rapid expansion of the crypto market.
It added that its competitors “are supporting certain crypto assets that are experiencing large trading volume and growth in market capitalization that we do not currently support, as well as offering new products and services that we do not offer.”
This may be a reference to the company’s stance against listing Dogecoin, a meme coin that currently stands at number four of top crypto assets by market capitalization.
Coinbase expects between 5.5 million and 9 million MTUs by the end of the year, with the annual average net revenue per user anticipated to be between $35 – $45 per month. The company also recently announced that it was acquiring crypto data analytics platform Skew to provide real-time actionable data analytics to institutions and traders.
While many have raised concerns over Coinbase’s over-reliance on retail trading commissions and its inherent exposure to volatility, the company’s first revenue report after its landmark IPO shows hope for the future of both Coinbase and the crypto industry.