Crypto exchange Coinbase reported a net income of $1.29 billion in the fourth quarter, while its $2.2 billion net revenue comfortably beat industry estimates.

Crypto exchange Coinbase reported a net income of $1.29 billion in the fourth quarter, while its $2.2 billion net revenue comfortably beat industry estimates. 

Coinbase posted its strongest quarter of earnings in over a year in Q4, as crypto prices and trading surged after the election of US President Donald Trump. 

Coinbase’s Feb. 13 financial results show the firm hit total revenue of $2.3 billion, up 88% quarter-on-quarter, while net income was $1.3 billion, both far exceeding analyst expectations. 

Trading volume reached $439 billion in the fourth quarter, beating estimates of $404 billion. 

Meanwhile, consumer transaction revenue increased over 178% quarter-on-quarter to $1.35 billion, while institutional revenue increased 155% over the same timeframe to $141.3 million in Q4 — a quarter highlighted by US President Donald Trump’s election win and rising market prices.

“The majority of the Y/Y growth in Trading Volume was driven by higher levels of Crypto Asset Volatility — particularly in Q1 and Q4 — as well as higher average crypto asset prices,” said the firm in a shareholder letter.

Coinbase also recorded $225.9 million and $214.9 million in stablecoin revenue and blockchain rewards revenue — the latter of which marked a 38.8% quarter-on-quarter increase.

Coinbase shares increased 8.44% to $298.1 during the Feb. 13 trading day but saw some volatility during after-hours trading. It is currently down 0.88% after hours to $295.01, Google Finance data shows.

Coinbase’s earnings come a day after online brokerage firm Robinhood posted a banner quarter in Q4, which saw shares rise as it beat consensus estimates and cryptocurrency revenue jumped 700% year-on-year.

Post-election volume surge

Crypto research firm Coin Metrics forecasted Coinbase's revenue to jump over 100% year-over-year, driven by a rise in trading volumes in Q4 2024. 

The increased trading activity has been “fueled by renewed market optimism post-U.S. election,” Coin Metrics said. US President Donald Trump has promised to make America “the world’s crypto capital” and has nominated pro-industry leaders to head key agencies. 

The trading volume largely comes from institutions as Coinbase continues to grapple with a drought in retail investor activity, crypto researcher Kaiko said on Feb. 10. 

“[R]etail traders — the highest fee payers — have not returned in force, with their share of volume shrinking to just 18%, down from 40% in 2021,” Kaiko said.

Subscriptions and services

In 2024, Coinbase significantly increased revenues from subscriptions and services, but the exchange “remains a trading platform at its core, with trading still accounting for […] more than 50% of revenue,” according to Kaiko.

Meanwhile, analysts anticipated seeing growth in Coinbase’s emerging subscriptions and services businesses. 

In Q4, the supply of the US dollar-pegged stablecoin USDC USDC $0.9998 on Coinbase grew by approximately 23%, a tailwind for the exchange’s stablecoin revenue, Coin Metrics said. 

But Coinbase’s Ethereum staking platform — another lucrative services business — has struggled to grapple with a general decline in ETH stakers, clocking a net outflow of nearly 1.3 million ETH in Q4, Kaiko said.

In the long term, a friendly US regulatory environment under Trump stands to benefit Ethereum’s staking business, researchers said. 

“We see Coinbase as a beneficiary of the election results as the firm has been struggling with regulatory pressure from the SEC,” Michale Miller, an equities researcher at Morningstar, said in a November research note.

Coinbase is also intent on expanding internationally. The US-based cryptocurrency exchange is in discussions with Indian regulators as it considers a return to the market after halting operations there in 2023.