Cryptocurrency exchange Coinbase revealed in its Q.4 report that it surpassed projected earnings for the last quarter despite a 57% year-on-year revenue drop as per a letter to its shareholders.
Our Q4 and FY'22 financial results are in.
Our letter to shareholders can be found on the Investor Relations website at https://t.co/8ovHEtPRgf
— Coinbase (@coinbase) February 21, 2023
According to the report, net revenue for the crypto exchange was at $605 million for the fourth quarter, thereby surpassing the previous $589 million revenue projected by Wall Street analysts.
It was established that transaction volumes shrinked by 12% in 2022’s fourth quarter. Nonetheless, Coinbase affirmed that there was a 34% increase in subscription and service revenues, which accounted for 5% total revenue growth.
However, Coinbase seized the medium to reaffirm that its staking products are not securities and should not be considered as such by the regulatory authorities. It was gathered that staking revenues dropped drastically during the last quarter.
It is noteworthy that the United States-based cryptocurrency exchange Coinbase is undergoing an investigation by the SEC over its staking products.
Overall, Coinbase classified the year 2022 as challenging for the entire crypto markets given the series of occurrences such as the bankruptcies of crypto hedge fund Three Arrows Capital, collapse of crypto exchanges like FTX, Voyager, having negative impacts on the crypto market.
Coinbase’s Battle With SEC Lingers On
Following the proposed ban on Coinbase crypto staking program, its CEO Brian Armstrong rejected the decision, saying that such a decision by the U.S. SEC will push more business offshore.
Armstrong argued that a ban on crypto staking for retail investors will set a terrible e path for the U.S. if such a decision is allowed to stand. It would be recalled that Kraken exchange crypto staking program has been terminally shut down by SEC
It appears that crypto firms are simultaneously battling bear market effects and regulatory clampdowns. Weeks ago, Coinbase and ConsenSys cut staff in reaction to market conditions.
Any given crypto firm aspiring to weather the storm and outlive the bear market should be ready to trend on solid foundations in compliance with extant regulatory rules.