Coinbase, one of the largest US-based cryptocurrency exchanges, has reported a significant drop in consumer trading volume, raising serious concerns throughout the crypto industry. According to this week’s second quarter earnings report, customer and institutional transactions have fallen by a combined total of 70% and 54% since last year’s same period, respectively. This immense downturn mainly stems from a decreased market capitalization of crypto-assets, a general decrease in the price and value of cryptocurrencies, and particularly Bitcoin’s relative stable trading positions since March. As a result, Coinbase had initiated layoffs last summer, with 1,100 employees losing their access to company emails hereunto, reducing its workforce by an additional 20% earlier this 2021. Despite the market situation, Coinbase managed a modest quarterly revenue and produced a code of conduct for governance protocols.
Though roiled by regulatory troubles with the US Securities and Exchange Commission accusing them of distributing illegal securities this June, Coinbase’s second quarter revenue was able to unexpectedly overcome, yet still within expected operational losses. The firm gained unexpected income from increased interest but only by $97m in losses down from $1.1bn this time last year.
The developments following Coinbase’s quarterly results have been promising for investors nonetheless. Many have expressed interest and even two crypto companies sponsored during the 2022 Super Bowl advertising beer and Ford pick-up trucks, something completely unprecedented only just over one year ago. The firm in their accompanying shareholders letter notes their improved financial routine efficiency despite the headwinds. Furthermore, thanks in part to Base, Coinbase has been hitting headlines concerning exchange volume and transaction records and figures recently, surpassing established networks in the space. Lastly, in return for these accomplishments, Coinbase stock has appreciated by 156%, even as the blockchain industry nonetheless ponders the legal ordeal with the SEC.
