U.S. compliance exchange Coinbase announced its second-quarter financial results. Due to the decline in the overall cryptocurrency market value, total revenue came to $1.4 billion, down from $1.6 billion in the previous quarter. Coinbase introduced cryptocurrency fair value accounting standards this year, but cryptocurrency prices fell this quarter, and EPS dropped significantly to $0.14.
Transaction revenue falls, but subscription and services revenue rises
In the second quarter, affected by the decline in the overall cryptocurrency market value, total revenue came to $1.4 billion, down from $1.6 billion in the previous quarter. The main reason for the decline came from a decline in trading revenue, which also reflected the downturn in the crypto market in the second quarter.
Second-quarter subscription and services revenue was $599 million, up 17% quarter-to-quarter. Compared to the previous quarter, subscription and services revenue benefited from higher average USDC platform balance and USDC market cap, as well as higher average crypto asset prices (particularly SOL and ETH). Blockchain reward income has also seen good growth.
EPS drops sharply to $0.14 on cryptocurrency prices
The U.S. Financial Accounting Standards Board (FASB) announced new accounting standards in September last year, allowing companies that hold cryptocurrency such as MicroStrategy to display the market value of cryptocurrency assets in their financial reports.
(FASB implements fair value accounting standards at the end of the year, benefiting companies holding cryptocurrency such as MicroStrategy)
Coinbase recognized $650 million in "income from crypto assets held for investment" in the first quarter, bringing first-quarter net profit to $1.176 billion and EPS of $4.4. However, in the second quarter, due to the decline in cryptocurrency prices, it lost $319 million again, and EPS dropped significantly to $0.14. This shows that the volatility of cryptocurrency prices has an important impact on the financial reports of listed companies.
Coinbase holds nearly 9,000 BTC and 110,000 ETH
According to previous reports, Coinbase’s own crypto assets include Bitcoin, Ethereum, SOL, etc., with the purpose of long-term investment holdings, crypto assets held and borrowed for operational purposes and related collateral.
As of 6/30, those held in long-term investments include:
Bitcoin: 8,999 (9,183 at the end of March)
Ethereum: 112,024 (96,086 at the end of March)
SOL is listed in financial reports for the first time, with trading revenue reaching 10%
This time Coinbase also included the trading revenue of Solana (SOL) in its financial report for the first time. SOL trading revenue has accounted for 10% of its overall trading revenue.
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