Crypto exchange Coinbase's transaction revenue declines 44% in Q3 CY22
Despite incurring losses, the firm has managed to cut its third-quarter costs by 50%.
Crypto exchange 's third-quarter (Q3 CY22) earnings report indicated a huge drop in its transaction revenue and also suggested that the firm has managed to cut its losses by 50%.
In the shareholder's letter, the firm stated that the decline in revenue was due to the larger macroeconomic effect as the market witnessed a decline in daily crypto market cap, with volatility declining to 30%.
“Transaction revenue was significantly impacted by stronger macroeconomic and crypto market headwinds, as well as the trading volume moving offshore," the report stated.
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The letter also disclosed that Coinbase saw transaction revenue of $366 million, representing a 44% decline from its second-quarter earnings. The monthly transacting users dropped to 8.5 million—down from 9 million in the prior quarter, but beating the estimates of 7.8 million. The overall net revenue was $576 million—a 28% decline—and total operating expenses were $1.1 billion, down 38% compared to the previous quarter.
However, despite incurring losses, coinbase has managed to cut its third-quarter losses by taking measures such as downsizing the workforce by 18%.
Recently, in August, the firm announced its partnership with asset management giant BlackRock. The crypto exchange also stated, "For 2023, we are preparing with a conservative bias and the current macroeconomic headwinds will persist and possibly intensify."
(This article was updated to correct a typo)
Edited by Kanishk Singh
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