Coinbase Posts $1 Billion Dollar Loss in Q2, Trading Volumes Take Major Hit

America’s biggest cryptocurrency exchange, Coinbase, has released its second-quarter revenue and reported a larger-than-expected quarterly loss of $1 billion amidst a drop in crypto prices and trading volumes.

Coinbase Records $1 Billion Loss in Q2

In its recently published second quarter performance, Coinbase reported a loss per share of $4.95 against the predicted $2.65. The exchange also missed its revenue estimates, reporting $808.3 million against the $832.2 million expected.

Coinbase’s net revenue declined from $2.033 billion in Q2 of 2021 to $802.6 million in Q2 of 2022, representing a drop of around 60%. This is worsened by a sharp increase in operational costs by over $500 million.

The decline in revenue amplified by the crypto market crash over the last eight months flipped Coinbase from an operating profit of $874.7 million in the Q2 of 2021 to a $1.04 billion operating loss in Q2 of 2022.

Coinbase’s Trading Volume Takes a Hit

While the crypto market crash played a significant role in the Q2 losses of Coinbase, a sharp decline in trading volume is another major factor.

The trading volumes at Coinbase dropped more than 50% in the second quarter to fall to $217 billion. The volume of retail trades sank by 68%, while institutional trading on Coinbase fell as much as 46%.

On the Flipside

  • Coinbase’s recent partnership with Wall Street giant and iShares owner BlackRock (BLK) is predicted to change the company’s fortune and affect the broader crypto market.

Why You Should Care

Coinbase’s Q2 performance reflects the eight-month market downturn, which has cut Bitcoin’s value to one-third of its November 2021 all-time high.

Read more about the Coinbase-BlackRock partnership in:

Coinbase Partners with BlackRock to Provide Institutional Clients with Crypto Access

Read about the effect of the losses on Coinbase shares below:

Cathie Wood of Ark Invest Dumps Coinbase Shares Amid SEC Probe

This article is for information purposes only and should not be considered trading or investment advice. Nothing herein shall be construed to be financial legal or tax advice. Trading Forex, cryptocurrencies, and CFDs poses a considerable risk of loss

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Author

Milko is a DailyCoin reporter, mainly focused on Ethereum (ETH), Cardano (ADA), and their founders (Vitalik Buterin and Charles Hoskinson). Milko is an avid follower of crypto and blockchain technology and has written thousands of articles on the subjects. He finds joy in transforming complex issues into written content that anyone can understand. Milko has used and analyzed numerous exchanges, such as Coinbase, FTX, and Binance. He also closely follows all of the latest news around the largest decentralized exchanges (DEXs).