Coinbase Shuns Bitcoin Strategy—Was It Protecting Profits Over Progress?

Leaked documents reveal Coinbase executives killed a bold Bitcoin investment play—not because it was risky, but because it might’ve cannibalized their core revenue streams. Talk about eating your young.

The irony? A publicly traded crypto giant refusing to innovate for fear of disrupting... itself. Wall Street would be proud.

Coinbase Avoided Crypto Bets to Stay Neutral with Customers

Chief Financial Officer Alesia Haas echoed Armstrong’s caution, stating that Coinbase deliberately avoided entering into competition with its own customers by betting on specific cryptocurrencies.

Despite that, Coinbase remains significantly exposed to Bitcoin. In its latest earnings report on May 8, the firm revealed a $153 million crypto purchase in Q1, primarily in BTC.

According to BitcoinTreasuries.net, Coinbase now holds 9,480 BTC, worth nearly $1 billion at current prices.

This makes it the ninth-largest corporate bitcoin holder globally, behind firms such as MicroStrategy, Tesla, and Marathon Digital Holdings.

While Coinbase held back from a full-scale Bitcoin pivot, other companies have embraced Saylor’s strategy, using equity and debt to fund large Bitcoin acquisitions.

Globally, over 100 public companies, 40 ETF issuers, and even 12 nation-states now report holding Bitcoin.

193 publicly traded entities now hold BTC on their balance sheet

+200% increase Year to Date

This is just the beginning.

We. Are. Going. Higher.https://t.co/QqvTssMzaj

Coinbase also made headlines this week by acquiring crypto derivatives platform Deribit for $2.9 billion, marking the industry’s largest merger to date.

The acquisition significantly boosts Coinbase’s presence in the crypto derivatives market, an area it previously accessed only through its Bermuda-based operations.

Deribit processed over $1 trillion in trading volume in 2024 and holds $30 billion in open interest.

Coinbase said the acquisition positions it as the new “global leader” in crypto derivatives.

Coinbase Q1 Revenue Climbs, But Profit Falls 94%

Coinbase reported mixed first-quarter results, with revenue rising 24% year-over-year to $2 billion, but falling short of analyst expectations and down 10% from the previous quarter.

While transaction revenue grew to $1.26 billion, its subscription and services division—covering staking and custodial offerings—rose 37% to nearly $700 million, reflecting growing diversification beyond trading.

Despite the revenue uptick, net income plunged 94% to $66 million as the company marked down its crypto holdings amid market volatility.

Adjusted earnings stood at $526.6 million, or $1.94 per share—still below last year’s figure of $2.53. Operating expenses surged 51% to $1.3 billion due to aggressive marketing and asset write-downs.

Coinbase’s earnings were weighed down by unpredictable macroeconomic conditions and fluctuations in digital asset prices.

However, the company noted its second-highest ever monthly user count, with CFO Alesia Haas highlighting increased engagement across non-trading services.