Why Coinbase $1,8B Q1 earnings are bullish for Bitcoin

Within a week of its IPO, Bitcoin and crypto exchange Coinbase has generated great hype. Its earnings report for Q1 2021 could have an impact that will be felt throughout the crypto market.

Coinbase Will go public on April 14th, after some controversy. The exchange’s estimated valuation sits at $100 billion and will resale up to 114 million Class A common shares under the ticker COIN.

Per their report, the exchange has generated $1.8B in revenue during their first quarter of 2021. In addition, it registers a $730 to $800 million in net income (up 312%), a traded volume of $335 billion (up 272%), and $223 billion in assets on the platform.

One key data is their number of active users, which is up by over 10 million in comparison with 2020’s numbers, which stand at 56 million. This is bigger than Venmo, Cash App, eToro, and Robinhood, as reported by stock analyst John Street Capital.

In contrast, with over 15 years of operations, PayPal has around 360 million active users. The analyst believes COIN could generate even more revenue than some of the most prestigious institutional trading platforms like the Chicago Mercantile Exchange, Nasdaq, amongst others. He added:

Incumbents can no longer ignore this. The BoD’s of $SCHW $IBKR $MS (as a result of the $ETFC acquisition) and Fidelity (even though they are private) have to add crypto trading at this point it’s almost a violation of their fiduciary duty to s/h not to.

Coinbase Q1 earnings effect on Bitcoin

Investment banker Ellie Frost has explained how the report’s effect may have been “underestimated”. Frost believes that once brokerages get a hold of Coinbase earnings, the exchange will “crush” their expectations.

This will be another reason why institutions won’t be able to continue ignoring the crypto market, as John Capital also claimed. It could also be a tool to benefit the entire market, in order to remove “prejudices” against the industry. Frost said:

Traditional finance can no…

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