Coinbase Posts $1.1 Billion Q2 Loss Due to 'Fast and Furious' Crypto Slowdown
This is the largest quarterly net loss for the crypto company since its Nasdaq IPO in April 2021.
New
Crypto exchange giant Coinbase cited a “fast and furious” downturn in crypto markets as the reason for a staggering net loss of $1.1 billion in the second quarter of 2022, which also saw the trading volume and trading revenue plummet.
This is the second consecutive quarter of loss for the crypto company and the largest loss since its Nasdaq (Nasdaq) IPO in April 2021.
The results, which also exceeded analysts' expectations, were shared Tuesday in a letter to Coinbase Q2 2022 shareholders, stating:
“The current downturn has happened fast and furiously, and we are seeing customer behavior mirror that of past bear markets.”
Coinbase said the second quarter was a "difficult quarter", with a 30% decline in transaction volume and a sequential decline in transaction revenue of 35%.
“Both metrics were influenced by a shift in client and market activity driven by macro and crypto factors,” he wrote.
Despite declining trading revenue, Morningstar equity analyst Michael Miller told Reuters in a report that while “Coinbase has not experienced a massive migration out of its platform […], its users are becoming more passive in their cryptocurrency investments.”
The crypto exchange reported revenue of $802.6 million, down 45.1% from the prior quarter and a staggering 153.1% drop from the prior quarter 'last year. Its net loss of $1.1 billion was primarily due to $446 million in non-cash impairment charges caused by falling crypto asset prices in the second quarter.
However, Coinbase wrote that despite the economic crisis, the company is doing its best to adapt to fluctuating market conditions.
In order to reduce expenses and improve profit margins,
This is the largest quarterly net loss for the crypto company since its Nasdaq IPO in April 2021.
New
Crypto exchange giant Coinbase cited a “fast and furious” downturn in crypto markets as the reason for a staggering net loss of $1.1 billion in the second quarter of 2022, which also saw the trading volume and trading revenue plummet.
This is the second consecutive quarter of loss for the crypto company and the largest loss since its Nasdaq (Nasdaq) IPO in April 2021.
The results, which also exceeded analysts' expectations, were shared Tuesday in a letter to Coinbase Q2 2022 shareholders, stating:
“The current downturn has happened fast and furiously, and we are seeing customer behavior mirror that of past bear markets.”
Coinbase said the second quarter was a "difficult quarter", with a 30% decline in transaction volume and a sequential decline in transaction revenue of 35%.
“Both metrics were influenced by a shift in client and market activity driven by macro and crypto factors,” he wrote.
Despite declining trading revenue, Morningstar equity analyst Michael Miller told Reuters in a report that while “Coinbase has not experienced a massive migration out of its platform […], its users are becoming more passive in their cryptocurrency investments.”
The crypto exchange reported revenue of $802.6 million, down 45.1% from the prior quarter and a staggering 153.1% drop from the prior quarter 'last year. Its net loss of $1.1 billion was primarily due to $446 million in non-cash impairment charges caused by falling crypto asset prices in the second quarter.
However, Coinbase wrote that despite the economic crisis, the company is doing its best to adapt to fluctuating market conditions.
In order to reduce expenses and improve profit margins,
What's Your Reaction?
