Compared to the anticipated $55 million, Coinbase‘s trading revenue from institutional transactions was $63.9 million upon Coinbase stock recovery.
In the after-market hours, the COIN stock surged by 3% after crypto exchange Coinbase (NASDAQ: COIN) reported robust earnings that surpassed Street expectations for the second quarter of 2024. The crypto exchange generated an astonishing $1.4 billion in revenue during the second quarter.
Coinbase Stock Activity Experiences Surge
Despite the low volatility of the crypto market, the crypto exchange pleasantly astonished everyone with robust trading volumes during the most recent quarter. As we know, crypto exchange revenues typically experience growth during periods of high volatility and during the bull and bear phases. Many traders have been compelled to remain on the sidelines due to the current limited trading range in which the Bitcoin price has been trading throughout Q2.
The crypto exchange’s retail and institutional trading volumes increased year-over-year to $236 million during Q2. Nevertheless, these figures represent a decline from the $312 billion trading volumes reported in the first quarter. Observing whether the trading volumes resume in Q3 in anticipation of the anticipated Federal Reserve rate cut in September will be intriguing.
As of Q2 2023, the exchange’s transaction revenue, which is generated by crypto trading activity, increased twice to an astonishing $780.9 million. The consumer-based transactions contributed $665 million, less than the anticipated $695 million. Nevertheless, the institutional transactions exceeded expectations by generating $63.6 million in revenue, as opposed to the anticipated $55 million.
With a net income of $36 million, Coinbase has reported a profit for the third consecutive quarter. The COIN share price has been in a constant state of oscillation, fluctuating between $200 and $280 over the past few months.
Ark Investments, headed by Cathie Wood, has been liquidating its COIN holdings since July of last month, which has resulted in selling pressure on the COIN stock.
Base Layer 2 Experiences 300% Quarter-over-Quarter Growth
The Layer 2 network is establishing itself as a fundamental component of the Coinbase ecosystem, recording a 300% increase in growth each quarter and becoming the leading L2 network regarding the total number of transactions processed. The Base network’s robust expansion is facilitated by a median daily fee of $0.01 per transaction.
Subscriptions and services revenue, which encompasses stablecoin revenue, blockchain rewards and fees, and other sources, also contributed significantly to the exchange’s revenue.
Additionally, the exchange emphasizes its efforts to promote regulatory clarity in the United States and monitor regulatory developments. According to the exchange, “Crypto legislation has become a mainstream issue in the United States, garnering bipartisan support. There is genuine energy within the House and the Senate to pass meaningful legislation.”
