The grim third quarter earnings report of the biggest cryptocurrency trading platform in the US has highlighted the dire state of the market.
Coinbase, which has been losing users monthly and seen its stock pounded this year, posted a loss of $545 million (USD) in the third-quarter amid the so-called crypto winter.
While the figures weren’t quite as disastrous as analysts predicted, there were still few signs of encouragement for retail investors who were swept up in the crypto frenzy of 2021 and have held on to their coins.
Coinbase’s share price fell eight per cent in day trading to plummet 78 per cent year-to-date. The fall mirrors the price of bitcoin, which has down more than 70 per cent from its all-time high in November, 2021.
Coinbase’s revenue is down 50 per cent year-on-year as its users have fallen from 9.2 million in the first quarter to 8.5 million. Retail transaction for the quarter was $346.1 million, down from more than $1 billion a year earlier.
“Transaction revenue was significantly impacted by stronger macroeconomic and crypto market headwinds, as well as trading volume moving offshore,” Coinbase said in its investor letter.
“We’re preparing for 2023 with a conservative bias and assuming that the current macroeconomic headwinds will persist and possibly intensify,” the company added.
Coinbase has been cutting staff — it shed around 1100 jobs in June — amid a range of measures to weather the market downturn.