Coinbase trading revenue surges, Q1 net profit exceeds 1.1 billion USD, cryptocurrency assets appreciate by 650 million USD.

In the first quarter of 2024, the U.S. compliant exchange Coinbase generated $1.6 billion in revenue, a 112% increase from the same period last year. The net profit exceeded $1.1 billion. Coinbase also recognized a $650 million gain in this quarter from the increased value of its investment holdings in cryptocurrencies, keeping its stock price steady above $200.

Trading Revenue Soars, Q1 Revenue Reaches $1.6 Billion

Coinbase generated $1.6 billion in revenue in the first quarter of 2024, a 112% increase from the same period last year. International exchanges contributed 17% of the revenue.

Consumer trading revenue for the first quarter was $935 million, up 99% from the previous quarter. Consumer trading volume for the first quarter was $56 billion, an increase of 93%. Consumer trading saw broad growth in the first quarter, including growth in new users, a recovery in trading activity from customers acquired before 2023, and an increase in average trading volume per user. This revenue is the main source of profit for Coinbase.

Stablecoin revenue was $197 million, up 15% from the previous quarter. The main driving factor was the increase in the market value of USDC, i.e., the total circulating supply of USDC.

Custodial fee revenue was $32 million, a 64% increase from the previous quarter. The main driver of growth was the rise in cryptocurrency prices. Additionally, Coinbase's role as custodian for 8 Bitcoin spot ETFs also contributed. By the end of the first quarter, the assets under its custody amounted to $171 billion.

Coinbase Holds 9,000 BTC and 90,000 ETH

According to previous reports, Coinbase holds various cryptocurrencies for long-term investment, operational purposes, and borrowed crypto assets and related collateral.

As of 3/31, the holdings for long-term investment include:

• Bitcoin: 9,183 coins, with a cost of $29,450
• Ethereum: 96,086 coins, with a cost of $1,982

Net Profit Exceeds $1.1 Billion, Crypto Asset Appreciation Recognized at $650 Million

The Financial Accounting Standards Board (FASB) announced new accounting standards last September, allowing companies holding cryptocurrencies like MicroStrategy to show the market value of crypto assets in their financial statements.

FASB approved fair value accounting standards by year-end, benefiting companies holding cryptocurrencies like MicroStrategy.

In its last financial report, Coinbase announced that it would start using the new accounting standards from 2024. In this quarter, it recognized $650 million as "gains on crypto assets held for investment." The net profit for the quarter reached $1.176 billion, compared to a loss of $78.9 million in the same period last year.

It turns out Coinbase also buys coins! With the new FASB standards, next quarter's earnings are expected to significantly increase.

COIN Stock Price Holds Above $200

Since the beginning of the year, Coinbase's stock price has risen to $280 amid the rally in Bitcoin, the listing of Bitcoin spot ETFs, and better-than-expected financial reports. Although there has been a correction recently due to the pullback in Bitcoin, the stock has already risen by 32% year to date.