Coinbase Q1 Revenue Soars 40% to $2B—But Profits Take a Hit

Wall Street’s favorite crypto casino posts record revenues while quietly watching margins evaporate. The house always wins—just not as much as shareholders hoped.

Revenue rockets on retail trading frenzy, but rising compliance costs and legal battles bite into bottom line. Another quarter proving crypto exchanges print money... until regulators come knocking.

Pro tip: When your ’record-breaking’ earnings call spends 20 minutes discussing SEC lawsuits, maybe don’t pop the champagne just yet.

Derivatives volume

Coinbase processed $315 billion in institutional trading volume in the first quarter and reported a $25 billion increase in average assets under custody. 

Additionally, the exchange added 39 new perpetual contracts to its international exchange (INTX), pushing its global derivatives trading volume above $800 billion.

The move further cements Coinbase’s role as the platform of choice for active crypto traders seeking access to advanced financial instruments.

Coinbase will release its full 10-Q filing with the SEC on May 9, detailing reconciliations between GAAP and non-GAAP metrics used in its earnings presentation.

Institutional trends and stablecoin growth

Coinbase also revealed that 86% of surveyed institutional investors either held digital assets or planned to make allocations this year.

Stablecoins emerged as a major growth segment for Coinbase. The average USDC balance held in Coinbase products rose 49% quarter-over-quarter to $12 billion, with USDC revenue up 32%.

The total stablecoin balance on Base, Coinbase’s ethereum Layer 2 network, climbed 12% to $4 billion, contributing to record demand as USDC market cap hit $60 billion.

Base itself saw a 16% quarter-over-quarter rise in transaction volume, reinforcing its position as the most active Ethereum L2 by user engagement.