Crypto exchange Coinbase’s total revenue fell 10% quarter-over-quarter to $2 billion in Q1, missing industry estimates by 4.1% as trading activity slowed across the market.
Coinbase’s net income was sliced by 95% from a near-company record $1.29 billion in Q4 to $66 million, in a large part due to Coinbase marking a $596 million paper loss on its crypto holdings.
The firm’s earnings per share of $1.94, however, managed to beat the Zacks Consensus Estimate of $1.85 for the quarter.
Coinbase’s May 8 results also showed that transaction revenue fell 18.9% quarter-on-quarter to $1.26 billion, as did trading volumes, which dipped 10.5% to $393 billion as crypto market cap dropped by double digits over the quarter, partly attributed to the Trump administration’s tariffs.
In contrast, US President Donald Trump’s election win in November was considered one of the main catalysts behind the rising market prices in Q4.
Meanwhile, Coinbase’s subscription and services revenue rose 8.9% to $698.1 million, with stablecoin revenue the most significant contributor.
Despite the fall in total revenue and trading volume, Coinbase said it gained more market share in global spot and derivatives trading while deepening its presence in emerging markets such as Argentina and India with “critical registrations.”
On the regulatory front, Coinbase said the dismissal of its lawsuit with the US securities regulator marked a “major judicial win for balanced, innovation-friendly regulation, and our efforts to make crypto mainstream.”
Coinbase makes deal with major crypto derivatives platform
On May 8, Coinbase agreed to acquire crypto derivatives platform Deribit for $2.9 billion, marking the industry’s largest corporate acquisition to date.
The acquisition will expand Coinbase’s footprint in the crypto derivatives market immensely, which previously had been limited to its Bermuda-based platform.
Coinbase noted that Deribit facilitated over $1 trillion in trading volume in 2024 and has around $30 billion of current open interest.
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The deal now makes Coinbase the “global leader” in crypto derivatives trading, the firm said.
Competitor firm Kraken struck a similar deal in March when it agreed to acquire futures brokerage NinjaTrader for $1.5 billion.
Coinbase’s Deribit deal contributed to a 5.1% rise in Coinbase’s (COIN) share price during the May 8 trading day, though shares have pulled back 3.1% in after-hours since the crypto exchange posted its Q1 results.
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