Coinbase earnings and a possible Crypto recovery
Can the embattled cryptocurrency exchange platform expect a turnaround?
When will Coinbase report its Q3 earnings?
Coinbase will publish its third quarter financial results on Thursday, 3 November after the market close.
What to expect?
- EPS forecast: -$2.23. The reported EPS for the same quarter last year was $1.62.
- Revenue: 646.73 million, 25% down from the previous quarter and a 59% decline from Q3, 2021.
What to watch?
• Monthly Transacting Users (MTU)
The sharp decline in crypto value significantly impacted investors appetite for high-risk digital coins, resulting in the market shrinking with fewer market participants.
Coinbase’s MTU was reduced by 20% from the beginning of the year. While the downtrend seemly slowed down towards the end of Q2, investors are keen to know whether users continued to move away from the platform as any rebound could be viewed as a early sign of recovery.
Revenue and new partnership
According to the Q2 earnings, net revenue declined 35% compared to Q1, primarily due to the sharp fall in retail transaction revenue. Learning from this, Coinbase made a move to partner with Blackrock with the hope that the world’s largest asset manager could help to generate a new source of revenue from the market.
From the impending Q3 report, investors should get a glimpse of whether the newly-formed partnership is working.
• Crypto landscape
Coinbase has suffered profoundly and is down nearly 80% from its 2021 IPO. It isn’t the first time crypto assets have gone through such a dramatic correction.
Since 2010, the crypto economy has experienced four major price cycles, with each prior cycle losing 70 to 90% of the total market value. However, the downtrend is often followed with a new cycle, bringing in additional market participants and a growing crypto landscape.
The key questions at the moment are: when will the next cycle start? And will Coinbase be able to preserve its market leadership by then?
From a technical point of view, the price for Coinbase retreated this week, returning to trade below the 20 and 100-day SMA after breaking above it last week. More importantly, the price action is now forming a double top shape which could suggest a further downtrend from the level of $63.
Further losses below this would likely meet the near-term support at $60. Only a reversal above $70 would likely signal an additional pushback to the high of October.
This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.
Start trading forex today
Find opportunity on the world’s most-traded – and most-volatile – financial market.
- Trade spreads from just 0.6 points on EUR/USD
- Analyse with clear, fast charts
- Speculate wherever you are with our intuitive mobile apps
See an FX opportunity?
Try a risk-free trade in your demo account, and see whether you’re onto something.
- Log in to your demo
- Take your position
- See whether your hunch pays off
See an FX opportunity?
Don’t miss your chance – upgrade to a live account to take advantage.
- Get spreads from just 0.6 points on popular pairs
- Analyse and deal seamlessly on fast, intuitive charts
- See and react to breaking news in-platform
See an FX opportunity?
Don’t miss your chance. Log in to take your position.
Live prices on most popular markets
Prices above are subject to our website terms and agreements. Prices are indicative only. All share prices are delayed by at least 15 minutes.
You might be interested in…
Find out what charges your trades could incur with our transparent fee structure.
Discover why so many clients choose us, and what makes us a world-leading provider of spread betting and CFDs.
Stay on top of upcoming market-moving events with our customisable economic calendar.