Five pictures to understand Coinbase’s second quarter shareholder letter

On August 11, 2021, Beijing time, the US cryptocurrency exchange Coinbase, which is listed on NASDAQ, issued a shareholder letter for the second quarter of 2021, detailing Coinbase’s operating data for the second quarter of 2021.

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Main operating indicators: In the second quarter of 2021, Coinbase’s monthly transaction accounts reached 8.8 million, compared with 6.1 million in the first quarter, an increase of 44%, and KYC users reached 68 million. Coinbase on total trading volume of $ 462 billion, an increase of 38% from $ 334.8 billion in the first quarter, in which retail trading volume reached $ 145 billion, institutional trading volume reached $ 317 billion. The total amount of crypto assets on the Coinbase platform reached 180 billion U.S. dollars, accounting for 11.2% of the total market capitalization of the cryptocurrency industry. Coinbase second quarter total revenue of 2.2 billion US dollars, net revenue of $ 2.033 billion, a net profit of $ 1.606 billion.

Golden Finance summarized the key points of the Coinbase shareholder letter for the second quarter of 2021, as follows:

Driven by DeFi and NFT, Ethereum transaction volume surpasses Bitcoin for the first time

aQP8FDjaIcDqYseviwBIWR1ZR4kLL1PsEIfa2Hep.pngThe total transaction volume in the second quarter reached 462 billion US dollars, an increase of 38% from the 334.8 billion US dollars in the first quarter.

Among them, retail trading volume reached US$145 billion, an increase of 21% compared to the first quarter, and retail trading volume accounted for 31% of total trading volume; institutional trading volume reached US$317 billion, an increase of 47% compared to the first quarter. Institutional trading volume Accounted for 69% of the total transaction volume.

Coinbase said that the growth of retail trading volume is mainly driven by the growth of monthly trading users; institutional trading volume is driven by the increase in institutional investors and their allocation of more capital in cryptocurrencies.

In terms of currency transaction volume distribution, Bitcoin transaction volume dropped sharply from 39% in the first quarter to 24%, and the proportion of Ethereum transaction volume rose from 21% in the first quarter to 26%, surpassing Bitcoin for the first time . At the same time, the proportion of the total transaction volume of other trading pairs rose from 40% in the first quarter to 50%.

This change is mainly due to three reasons: 1. The decline in the proportion of Bitcoin transaction volume is related to the decline in Bitcoin spot transactions on all exchanges; 2. The proportion of Ethereum transaction volume surpassing Bitcoin for the first time is mainly because of the DeFi and NFT ecology. Growth , and the growth of ETH2 pledge demand; 3. Other trading pairs accounted for 50% of the total trading volume, because Coinbase launched many other tokens in the second quarter. In the second quarter alone, the number of coins on Coinbase exceeded 2021 The number of coins listed throughout the year. In the first half of 2021, Coinbase has 29 new types of crypto assets and 39 new types of crypto assets under custody.

Both retail investors and institutions are pouring in: 68 million retail investors 9,000 institutional investors

In the second quarter, monthly retail trading accounts increased to 8.8 million, compared with 6.1 million in the first quarter, an increase of 44%, of which KYC users reached 68 million.

Institutional investors reached 9,000. Despite the price fluctuations in the crypto market, institutional investors were running into the field of cryptocurrency in the second quarter. Of the top 100 hedge funds, 10% chose Coinbase. In addition, Coinbase has also reached cooperation with Musk, PNC, SpaceX, Tesla, Third Point and WisdomTree.

Platform assets: 11% of the industry’s assets are in Coinbase

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As of June 30, the total amount of crypto assets on the Coinbase platform was $180 billion, accounting for 11.2% of the total market value of the cryptocurrency industry. Of these, 47% are Bitcoin, 24% are Ethereum, 25% are other encrypted assets, and the remaining 5% are legal tender.

Transaction income: retail accounts contribute more than 80%

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Coinbase’s total revenue in the second quarter was US$2.2 billion and net revenue was US$2.033 billion, including transaction revenue of US$1.93 billion and subscription and service revenue of US$103 million. Among the transaction revenue, retail transaction revenue was US$1.828 billion, an increase of 26% compared to the first quarter. The strong growth in retail transaction revenue was mainly driven by the monthly increase in the number of retail transactions in April and May, as well as marketing and new crypto assets; institutional transaction revenue 102 million US dollars.

Some other interesting data: the profit doubled in the second quarter came from tax incentives, there are 4.4 billion US dollars in cash on the account

Coinbase also disclosed some other interesting data in its shareholder letter for the second quarter. For example, Coinbase’s net profit in the second quarter was US$1.61 billion, a 108% increase from US$771 million in the first quarter.

According to Coinbase’s explanation, the reason for the substantial increase in Coinbase’s net profit in the second quarter was tax relief.

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In the second quarter, Coinbase confirmed a tax benefit of $737 million, mainly due to the tax deduction for stock-based compensation provided to full-time employees after Coinbase’s direct listing in April.

In terms of the number of employees, Coinbase added 450 new employees in the second quarter and currently has 2,176 full-time employees.

In addition, as of the second quarter, Coinbase had $4.4 billion in cash and cash equivalents on its accounts.

 

Posted by:CoinYuppie,Reprinted with attribution to:https://coinyuppie.com/five-pictures-to-understand-coinbases-second-quarter-shareholder-letter/
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