Coinbase shares plunge as the company reports a loss of $430 million in the first quarter

The exchange’s trading volume fell by around 44% between January and March as it reported worse-than-expected performance during that period.

The cryptocurrency market was largely limited in scope in the first quarter with little opportunity for short-term traders, resulting in a drop in volume. Coinbase generates 85% of its revenue from transaction fees above the industry average, so the drop had a direct impact on revenue for the period.

On May 10, the company reported a net loss of $430 million, well above the $47 million Wall Street analysts had expected. financial times.

Coinbase sales slump

Revenue fell 35% year-over-year to $1.16 billion, significantly better than analysts’ forecast of $1.5 billion. company criticism In 2022, the cryptocurrency market declined and volatility increased, but we were optimistic about the future.

“We believe these market conditions are not permanent and we are focused on the long term.”

Revenue derived from transaction fees still accounted for the largest share of the total at 87%. The rest came from subscriptions and services.

The significant monthly trading users (MTU) figure fell to 9.2 million, nearly 20% lower than in the fourth quarter of 2021. This fell short of analysts’ expectations of 9.5 million. Earlier this month, CEO Brian Armstrong predicted that there will be 1 billion cryptocurrency users over the next decade.

The platform’s trading volume decreased from $547 billion in the fourth quarter of 2021 to $309 billion in the first quarter of 2022. Of these, only 24% were retail traders, with the majority being institutional traders. Institutional trading volume was reported at $235 billion, down 37% from the fourth quarter.

During this period, the number of assets on the platform also decreased by 8%. At the end of the first quarter, the platform’s funding was $256 billion, down from $277 billion at the end of the fourth quarter. The report explained that the “sequential decline was due in part to the decline in cryptocurrency asset prices and was partially offset by billions of dollars in net inflows.”

COIN Falls to ATL

Coinbase stock fell to an all-time low as a result of a worse-than-expected performance report. COIN was down 16% in after-hours trading on Tuesday after losing around 13% in the regular session.

The current share price is $61.55. market watch. It is now down 84% from its all-time high of over $400 when it went public in April 2021.

The cryptocurrency market is down about 50% from all-time highs over the same period. Its total market cap is now at $1.47 trillion, a 10-month low.

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