Coinbase's Q4 performance is impressive, with net income soaring by 80% and total trading volume skyrocketing by 185%

Thanks to the support for cryptocurrency from Trump's victory, Coinbase, the largest cryptocurrency exchange operator in the U.S., reported impressive Q4 results, with total trading volume soaring and net income rising by 80%.

On Thursday local time, Coinbase announced its impressive performance for the fourth quarter of 2024:

Net income: $1.3 billion, compared to $273 million in the same period last year, a year-on-year increase of 80%;

Revenue: $2.27 billion, far exceeding the expected $1.88 billion;

Earnings per share: $4.68, well above the expected $1.81;

Total trading volume: $439 billion, a year-on-year increase of 185%; consumer trading volume increased by 224% year-on-year, and institutional trading volume increased by 176% year-on-year.

In a letter to shareholders, the company stated:

“The main reason for the year-on-year increase in trading volume is the increased volatility of crypto assets, especially in the first and fourth quarters of 2024, as well as the general rise in crypto asset prices.”

“The two main drivers behind these macroeconomic factors are the launch of Bitcoin ETF products in the first quarter of 2024 and the election of pro-cryptocurrency presidents and Congress in the fourth quarter of 2024, with market expectations that U.S. government regulation of the cryptocurrency market will become clearer—both of which led to a surge in cryptocurrency spot trading activity.”

However, Coinbase also stated that the company is working to diversify its revenue sources and reduce reliance on trading—as of the fourth quarter, trading accounted for 68.5% of the company's total revenue, most of which came from retail traders.

As of February 11 this year, Coinbase has generated $750 million in revenue from trading.

Looking ahead, Coinbase expects that the proportion of trading revenue to net income in the current quarter will be between 13-19%, and revenue from subscription and services (including stablecoins, staking, custody, and Coinbase One products) is expected to be between $685 million and $765 million.

Coinbase also expects that the USDC stablecoin issued by Circle and the revenue-sharing agreement with Coinbase will drive a quarter-on-quarter increase in sales and marketing expenses in the first quarter.

The company's Chief Financial Officer Alesia Haas told CNBC that Congress is expected to pass a stablecoin bill this year, and USDC is likely to see growth:

“We can drive more USDC-denominated transactions on our platform, thereby boosting its liquidity; the stronger the liquidity, the higher the adoption rate of any asset.”

The company's CEO Brian Armstrong also stated that the company has a grand goal of making USDC the largest stablecoin:

“USDC has a network effect, and the compliant approach they are taking will give it strong defensibility in the long term.”

Currently, USDC accounts for about 26% of the total market value of stablecoins, ranking behind Tether's 67%