Cryptocurrency exchange Coinbase shares tumbled 10% on Tuesday (09), up more than 4% in after-hours trading, after a lower-than-expected earnings report for the second quarter of the year.
Coinbase underperformed analysts’ expectations, posting $808.3 million in revenue for the second quarter. The company’s expectation was US$ 832.2 million.
The total number of users transacting on the platform totaled 9 million, down by 200,000 in the last three months. Compared to the same quarter a year ago, Coinbase showed a gain of the same amount of monthly active users over the course of a year.
The company posted a net loss of $1.1 billion in the final financial quarter, its second consecutive negative profit period. In the second quarter of last year, Coinbase’s net income reached $1.6 billion. Coinbase makes money from fees paid by users when they trade bitcoin and other cryptocurrencies. Trading volume on the exchange dropped 29% in the second quarter.
Coinbase debuted on Wall Street when it was listed on Nasdaq in April last year as the first publicly traded cryptocurrency exchange. At one point, its stock price reached $342, much higher than the current price of $87 a share.
While the Securities and Exchange Commission (SEC) gave Coinbase the green light to go public last year, the company found itself in the regulatory agency’s crosshairs in late July. The SEC claims that nine tokens on the exchange are unregistered securities, while Coinbase claims that it does not sell this type of product.
The SEC’s determination was disclosed in insider trading allegations made against three people, including a former Coinbase project manager with prior knowledge of tokens that would be listed on the platform. Ark Invests CEO Cathie Wood said the ensuing “regulatory” uncertainty was so intense that the company sold $75 million worth of stock in the brokerage.
However, Coinbase’s share price rose sharply last week on news that the company had struck a deal with Blackrock, the world’s largest asset manager. Coinbase will provide the financial giant with cryptocurrency trading technology for institutional investors on its Aladdin platform.
*Translated by Bitcoin Portal with Decrypt authorization
Don’t know which is the best crypto asset for your profile? At Bitcoin Market, those who are just starting to invest have the best trading experience and stay informed about everything! Learn more about Bitcoin Market!
