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Morning Minute is a daily newsletter written by Tyler Warner. The analysis and opinions expressed are his own and do not necessarily reflect those of Decrypt. Subscribe to the Morning Minute on Substack.
GM!
Today’s top news:
Crypto majors fall 2-3% after Powell says rate cut not certain in December
US Senator claims Binance helped with TRUMP launch for CZ pardon
Coinbase smashes earnings with $1.9B in revenue; Armstrong toys with mention markets
MSTR beats earnings with $2.8B in profit, holds 640,808 BTC
Token Works announces REKTSTR as first ERC20 strategy
Revenue of $1.9B (~55% year-over-year), beating consensus by roughly $200M
Net income $433M (477% YOY)
Transaction revenue topped $1B (+83% YOY), a demographic shift driven by institutional flows and high-frequency trading
Monthly transacting users (MTUs) came in at 12.6M, exceeding expectations and reversing the prior quarter’s decline
Base Layer (the company’s Layer-2 chain) achieved positive adjusted EBITDA for the first time
Forward guidance: Coinbase projects Q4 revenue in the $2.2B–$2.3B range, assuming average daily trading volume in the $300B range and modest crypto price tailwinds.
Coinbase also bought ~$300M of Bitcoin in Q3.
🗣️ What They’re Saying
“We are accelerating payments through stablecoin adoption, which we anticipate will continue given policy tailwinds, and ongoing adoption from financial institutions and corporates for payment and treasury needs.” - Coinbase shareholder letter
We had a strong Q3 at Coinbase:
- Significant revenue, and positive adjusted EBITDA - Continued progress on our Everything Exchange vision - Notable strength across derivatives products
Coinbase has a few factors in its favor right now: volatility, institutional demand, stablecoin adoption and favorable regulatory shifts.
Expanding on those:
Heightened volatility in digital-assets in July and strong institutional interest helped drive the surge in transaction revenues
They see the rising importance of stablecoins for payments and treasury use, saying they anticipate continued growth of stable-coin adoption supported by “policy tailwinds” and institutional/ corporate demand
Trading volumes and revenue benefited from a crypto rally tied to both macro developments and favorable regulatory shifts.
Plus, their L2 Base continues to shine and drive meaningful revenue for the company.
It’s a strong combination.
And they will need it, with more and more big banks and institutions getting into the crypto game (custody, trading and more).
But maybe that turns into a tailwind for Coinbase as well, with their crypto-as-a-service offering starting to take off.
The stronger Coinbase is, the more appealing COIN stock is compared to crypto majors (even Bitcoin).
