In case you haven’t heard, we’re in a bit of a crypto winter (or a crypto recession or a crypto bear market – pick your poison). So when Coinbase announced last week that it would partner with BlackRock to use some of its software tools for Bitcoin, it was good news. Coinbase stock rallied and injected some much-needed optimism amid the current market, especially after recently announcing a hiring freeze and going through layoffs.
In the bigger picture, though, Coinbase is still suffering. In the second quarter, it lost over US$1 billion, or about US$5 a share, compared to the about US$1.6 billion net income from the same time last year. It’s trading at around US$86 a share, which is way down from the US$381 it was trading at when it went public.
Coinbase is one of the few crypto companies that trade on the stock market, and it’s considered a sort of waypoint into crypto for the more traditional finance industry.
“Over the past few years, Coinbase has played a central role in developing and strengthening crypto markets as the safest, most trusted bridge to the cryptoeconomy,” wrote Brett Tejpaul, the head of Coinbase Institutional, and Greg Tusar, the company’s VP of Institutional Product. “Coinbase Prime will provide crypto trading, custody, prime brokerage, and reporting capabilities to Aladdin’s Institutional client base who are also clients of Coinbase.”
“Q2 was a test of durability for crypto companies and a complex quarter overall,” Coinbase said in its letter to shareholders. “Dramatic market movements shifted user behavior and trading volume, which impacted transaction revenue, but also highlighted the strength of our risk management program.”