Home Markets Coinbase posts $1.1 billion loss as crypto trading volumes plummet

Coinbase posts $1.1 billion loss as crypto trading volumes plummet

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Coinbase posts $1.1 billion loss as crypto trading volumes plummet

Cryptocurrency exchange Coinbase revealed that revenue fell 61% in the last quarter as crypto prices plummeted and trading volumes crashed.

The San Francisco-based company reported an after-tax loss of $1.1 billion on Tuesday compared to the $1.6 billion net profit it posted amid the crypto boom a year ago. It said $446 million of the loss reflected an impairment charge on its crypto and risky investments.

Coinbase shares fell 4% in aftermarket trading, having already lost nearly 11% earlier in the day.

The price crash of bitcoin and other cryptos plunged the company into the red in the first quarter, leading it to Fire 18 percent of its staff in June. With trading volume still down 30% from the weak first quarter, it still suffered an operating loss of $620 million before the impairment charge and its net cash position fell another $400. million, to $2.8 billion.

At $46 billion, trading volume on behalf of retail clients was down more than two-thirds from a year earlier. Despite the setback, the company maintained that the downturn was part of a typical cycle in crypto markets and said its analysis “suggests [retail] customers do not leave the Coinbase platform”.

Coinbase posted net income of $803 million in the quarter and a loss per share of $4.98. Wall Street expected a loss of $2.65 per share on revenue of $832 million.

Shares of the company have been very volatile in recent days, jumping more than 30% last week on a Alliance with BlackRock. They had already given up two-thirds of the gain before Tuesday’s results announcement.

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