With a strong security and regulatory compliance track record, Coinbase has established itself as a trustworthy platform for individuals and institutions to buy, sell, and store various cryptocurrencies.
In this article, we’ll examine some key statistics, such as their Revenue, Net Income, Assets on the Platform, user base growth, and other metrics, to see how successful they have been in this challenging time for crypto.
Coinbase acts as a Fiat on-ramp between the traditional finance world and the crypto-verse.
Here are some key corporate facts about Coinbase:
- Founded in: 2012
- Headquarters: Berry St, San Francisco
- IPO date: 14 April 2021
- Listed Exchange: NASDAQ
- All-time high share price: $343
- Sector: Finance (Consumer Services)
- Industry: Cryptocurrency
- Ticker: COIN
- Founders: Brian Armstrong and Fred Ehrsam
- Number of employees: 3,500+
Although the Securities and Exchange Commission (SEC) in the United States is starting to come down hard on cryptocurrency exchanges, Coinbase is one of the better-placed businesses to deal with regulatory uncertainty and could be an opportunity to grow its market share.
“Following the 2022 Events, one of our highest priorities is to restore confidence and interest in the cryptoeconomy and maintain and increase engagement on our platform. We believe our safe and trusted crypto platform positions us well to achieve this, particularly because we have policies and procedures and take steps to help ensure proper safeguarding of crypto assets we hold.”
What Services does Coinbase Provide?
To get a better idea of Coinbase’s business model, let’s first look at a list of services they offer:
- Exchange services allowing you to buy/sell crypto assets
- Advanced trading
- Self-Custody Wallets
- Institutional and business accounts
- E-commerce business payments
- Prepaid Cards
At the time of writing, you can trade over 200 different crypto assets on Coinbase’s platform, including Bitcoin, Ethereum, Cardano, Solana, and Polkadot.
Ranking of Coinbase vs its Competitors
Below is a comparison of the typical 24-hour trading volume of Coinbase versus some of its competitors. Binance remains the biggest player in the market by far.
|Exchange||24-Hour Trading Volume (millions)|
Coinbase Assets on Platform (AUM)
The value assets on the platform increased massively when the company went public and hit a peak of $278bn in Q4 of 2021. The price of Bitcoin and other crypto assets was also hitting all-time highs in this period, meaning the growth in assets was not all due to customer capital inflows.
The value of assets on the platform fell significantly when the crypto bull market ran out of steam. Coinbase now has a reported $130bn assets on its platform as per their latest 10-Q (1ºQ 2023).
Yearly Assets on Platform
|Year||Total AUM ($ billion)|
Quarterly Assets on Platform (AUM)
|Quarter||Total ($ bn)||Retail ($ bn)||Institutional ($ bn)|
|Q1 2023||$130||Not reported||Not reported|
Coinbase Key Financials
When Coinbase initially went public, it saw an almost 6-fold increase in net revenue between 2020 and 2021. But since the peak of the crypto bull market, the industry has been hit with a plethora of scandals and collapses, including FTX, Celsius, Voyager, and Terra Luna to name but a few. Net revenue has since fallen 63% from its peak as Coinbase generates a large portion of its revenue from transaction fees.
“Our total revenue is substantially dependent on the prices of crypto assets and the volume of transactions conducted on our platform. If such price or volume declines, our business, operating results, and financial condition would be adversely affected.”
Net revenue is made up of revenue earned from customer transactions and subscriptions and services revenue, including blockchain rewards, custodial fees, interest income, etc.
Below is a breakdown of the yearly net revenue figures over the past number of years.
|Yearly||Net Revenue ($ millions)|
|2023 (TTM March 2023)||$2,720|
Below you will see the quarterly revenue figures for Coinbase. Quarterly revenue bottomed out in Q3 of 2022 and has since increased modestly along with the wider crypto market.
|Quarter||Net Revenue ($ millions)|
Until recently, Coinbase regularly reported the average revenue it generated per user per month, reaching a peak of $64 in 2021. This metric was not reported in 2022 and 2023 when the company’s financial performance was declining overall.
See below a summary of the average revenue per user (per month) from 2017 to 2021.
Revenue Per User (Per Month)
|Year||Average Revenue Per User (per month)|
2021 was a stellar year financially for Coinbase, earning a net income of $3,623 million, a 46% net margin and over 10 times the net income from the prior year. As often happens when a company grows this fast, it can run into trouble; when Coinbase’s revenue dropped significantly in 2022, they were unable to reduce their cost in the proportional measure in such a short space of time and ended up making a loss of $2,625 million in 2022.
In the following sections, you can see a summary of Coinbase yearly and quarterly reported net income.
Yearly Net Income/(Loss)
|Year||Net Income ($ millions)|
|2023 (TTM March)||($2,275)|
Quarterly Net Income/(Loss)
|Quarter||Net Income ($ millions)|
Coinbase User Statistics
For investing purposes, one of the most vital metrics to keep an eye on is the growth in the user base at Coinbase. It is also important to know the difference between a verified user and an MTU (Monthly Transacting User).
A verified user is a retail or institutional investor who has successfully set up a Coinbase account. However, this does not mean that Coinbase is generating revenue from this type of customer. The more reliable metric to keep a close eye on is the MTUs (Monthly Transacting Users).
In the following tables, you will find data from Coinbase on its Verified users and MTUs over the past number of years.
Monthly Transacting Users (MTUs)
Interestingly, since its peak, the monthly transacting users at Coinbase have only fallen 26% to 8.4 million. Compared to net revenue, which fell 70% from its quarterly peak in Q4 2021 vs the latest quarterly earnings. This shows the potential for the net revenue to rebound quickly at Coinbase if the crypto market goes back into a bullish period.
Quarterly Trading Volume split by Retail vs Institutional Investor
Institutional investors have become critical to the success of Coinbase over the past number of years, they now account for 86% of the trading volume. You can check out the split between retail and institutional trading volume from Q1 2020 to Q1 2023 in the following table.
|Quarter||Total ($bn)||Retail ($bn)||Institutional ($bn)|
Quarterly Trading Volume split by cryptocurrency
The change in investing trends in cryptocurrency can be seen clearly when you look at the split of Coinbase’s quarterly trading volume.
Bitcoin currently makes up 32% of Coinbase’s trading volume, versus Ethereum and other Altcoins making up 24% and 44%, respectively. Bitcoin dominance was dropping throughout 2021 but has since seen a resurgence in 2022/2023.
|Quarter||Total ($bn)||Bitcoin ($bn)||Ethereum ($bn)||Altcoins ($bn)|
In summary, Coinbase has taken a different approach to many other crypto exchanges and has looked to be compliant in an industry that has been slammed for being the wild west of finance.
While the company had achieved initial success, the contagion that has spread across the industry from multiple bankruptcies has dampened recent growth in revenues and users.
If cryptocurrency is to be legitimised, Coinbase will have a major part to play in its future.
Is it safe to use Coinbase?
Unlike when you invest in stocks or ETFs with a traditional investment broker, you will not be covered by any investor compensation scheme if Coinbase were ever insolvent.
In terms of account security, Coinbase will always be a target for hackers but has only had one reported instance where 6,000 customer accounts were affected by a hack and lost their assets.
There are several ways you can bolster the security of your account by adding multi-factor authentication, as well as whitelisting wallet addresses. You can also take self-custody of your crypto assets, which you can then store completely offline via a Ledger or Trezor wallet.
Are there any legal actions taken against Coinbase by regulators?
In June 2023, the Securities and Exchange Commission (SEC) filed a lawsuit against Coinbase for selling securities while not being registered as a broker.
What Countries is Coinbase Available in?
Coinbase is currently available in over 100 countries worldwide, including the US, Canada, the UK, and Europe. The United States is Coinbase’s biggest market, making up roughly 40%, followed by the UK / Europe at roughly 25%.
Can you buy NFTs on Coinbase?
Yes, Coinbase has its own NFT marketplace, which is still in beta. Many popular collections are available to buy and sell on this marketplace, such as the Bored Ape Yacht Club.
Does Coinbase have a Custodial Wallet?
If you feel more comfortable taking self-custody of your crypto assets rather than leaving them in possession of Coinbase, then they also provide a custodial wallet that supports thousands of crypto assets.
This wallet will also allow you to interact with Defi protocols and many other Dapps.