Coinbase Sees More than $1 Billion Losses in Net Income in Q2 2022

Cryptocurrency exchange Coinbase released its financial results for the second quarter of 2022. The exchange's net income fell by more than $1 billion for the quarter, the data showed.

More specifically, net revenue of the exchange was $803 million, dropping 31% from $1.165 billion in the previous quarter and dropping 61% from $2.033 billion in Q2 2021.

Net income (loss) was -$1.094 billion, a loss of $664 million more than the previous quarter. In the second quarter of last year, it earned $1.606 billion.

Adjusted EBITDA was a loss of $151 million, compared with a profit of $20 million in the previous quarter. The adjusted EBITDA in 2Q21 was $1.15 billion.

The revenue of cash and cash equivalents declined sequentially, dropping 7% to $5.685 billion from $6.116 billion in the previous quarter, but up 30% from $4.366 billion a year earlier.

Total trading volume was $217 billion, falling by 30% from the previous quarter's $309 billion and down 53% from $462 billion in the second quarter of last year.

Assets on platform were $96 billion, down 63% from the previous quarter ($256 billion) and dropping 47% from $180 billion in the second quarter of last year.

​Coinbase stated in the shareholder letter: "Q2 was a test of durability for crypto companies and a complex quarter overall. Dramatic market movements shifted user behavior and trading volume, which impacted transaction revenue, but also highlighted the strength of our risk management program"

The exchange added: "While we did see net outflows in Q2, we observed that the majority of this behavior was institutional clients de-risking and selling crypto for fiat as opposed to withdrawing their crypto to another platform. As a result, our market share of the total crypto market capitalization declined to 9.9% from 11.2% in Q1."