Morning Minute: Coinbase Posts Surprise Loss as Crypto Trading Dries Up - Decrypt
Morning Minute is a daily newsletter written byTyler Warner. The analysis and opinions expressed are his own and do not necessarily reflect those of Decrypt. GM!Today’s top news:Crypto majors are red while. . .
Morning Minute is a daily newsletter written byTyler Warner. The analysis and opinions expressed are his own and do not necessarily reflect those of Decrypt. GM!Today’s top news:Crypto majors are red while stocks grind higher; BTC -2% at $63. 7kBTC ETFs see $233M in net inflows, 2nd biggest day since early MayCoinbase posts surprise loss in Q2 earnings; Strategy books $8. 2B lossNY AG files petition to shut down Kalshi, seeks $36B in damagesColdcard exploit leads to $38M in Bitcoin losses📉 Coinbase Posts a Surprise Loss as Trading Dries UpCoinbasereported $1. 22 billion in second-quarter revenueon Thursday, down 14% from the prior quarter and 19% from a year ago, along with a net loss of $359 million. COIN stock fell roughly 5% after hours. The miss was broad: revenue came in below the $1. 29 billion Wall Street expected, and the loss of $1. 36 per share was far worse than the roughly break-even result analysts had modeled. Total crypto spot trading volume fell more than 20% from the prior quarter as prices slid and volatility hit multi-year lows, dragging transaction revenue down 21% to $599 million. Subscription and services revenue also missed, despite being the less trading-dependent segment of the business. Coinbase blamed late-closing USDC commercial agreements and lower staking revenue from falling prices, but the shortfall undercut the idea that the diversified businesses are decoupled from the trading cycle. On the bright side, stablecoin revenue reached $292 million, with average USDC held on Coinbase products hitting a record $20 billion, more than 30% of all USDC in circulation. Prediction-market revenue more than doubled quarter over quarter, up 106%, and crossed a $100 million annualized run rate. Coinbase’s share of global crypto trading volume hit a record 10. 3%, its third straight quarter of market-share gains, and the company said 88% of net revenue now comes from sources other than Bitcoin spot trading, up from 45% in 2020. It also held $8. 6 billion in cash, extended a 14-quarter streak of positive adjusted EBITDA, and lowered its full-year expense outlook. Now that the results are in, it’s interesting to look at Robinhood and Coinbase side by side. Both reported crypto trading revenue shrinking and prediction markets surging, but Robinhood posted record profit while Coinbase posted an outright loss. Coinbase is clearly far more exposed to the trading cycle it’s trying to grow beyond, and it doesn’t yet boast 13 9-figure product lines. As for Q3, guidance is looking fairly soft. But that may not be accounting for Cobie taking over trading and the apps. Let’s see how fast he can get to work on turning the story around…🌎 Macro Crypto and MarketsCrypto majors are slightly red;BTC -2% at $63. 7k; ETH -2% at $1,880; SOL -1% at $73. 40; HYPE +3% at $54. 90Top alt moversinclude UNI (+5%), PUMP (+5%) and ADA (+3%)Oil+1% at $85; Gold +1% at $4,115Stock futuresare green as tech stocks and memory go higher; DOW +0. 5%, Nasdaq +1. 2%Strategybooked an $8. 2 billion Q2 lossas Bitcoin fell below its $75,476 cost basis, far worse than the $2. 15 billion Wall Street expected, though it added 11% to its stack and said its cash reserve covers two-plus years of dividendsCathie Wood’s Ark Investsold BitMine while adding to Coinbase and Circle, trimming about $4. 4 million across BitMine, Robinhood, Block, and Bullish after their shares fell, while recently buying roughly $43. 5 million of Coinbase and CircleTreasury Secretary Scott Bessenturged the Senate to pass the CLARITYAct, accusing Democrats of stalling for political reasons and closing his appeal by quoting Satoshi Nakamoto: “If you don’t believe me or don’t get it, I don’t have time to try to convince you, sorry. ”The Bitcoin quantum threatinched closer as IBM claimeda “trusted quantum advantage,” a milestone that renews urgency around hardening Bitcoin’s cryptographyElon Musk’s xAIsued Minnesota to blockthe US’s first AI nudification law, challenging it on free-speech groundsOndo Financeis weighing an acquisitionworth up to $500 million, as the real-world-asset tokenization firm looks to expand through M&ACorporate Treasuries & ETFsThe Bitcoin ETFssaw $233M in net inflowson Thursday; the ETH ETFs saw $13M in inflowsMeme Coin TrackerMeme leadersweremixed;DOGE -1%, SHIB even, PEPE -1%, PENGU +4%, TRUMP -2%, BONK -5%Robinhood chainwas led by FRONG (+600x) and IF (+74%)Solana leadersincluded Moondogecoin (+300x) and KET (+60%); ANSEM +4% at $178M💰 Token, Airdrop & Protocol TrackerThe New York Attorney Generalfiled a petition to shut down Kalshiin New York State over what it's calling an illegal gambling operation and seeks at least $36B in damagesPonswent live on Uniswap's Launches aggregator, touting more than 210,000 tokens launched in two weeks and over $283 million in volume through Uniswap pools, with a v2 coming on Uniswap v4 to bridge memecoins and RWAs on Robinhood Chain (PONS -12% to $28M)A Coldcard key flawdrained $38 million in Bitcoin, with 594 BTC swept from about 500 wallets in 25 minutes after a build error left seeds far more guessable than intended; maker Coinkite believes an attacker used AI to find the bug in its open-source firmware, a review its own AI had missed weeks earlier🚚 What is happening in NFTs?NFT leaderswere red; Punks even at 32. 3 ETH, BAYC -1% at 8. 3 ETH, Pudgy -4% at 3. 8 ETH; Hypurr’s even at 189 HYPENo notablemoversDaily Debrief NewsletterStart every day with the top news stories right now, plus original features, a podcast, videos and more.