Coinbase Global Inc. shares climbed as much as 4% Thursday after the cryptocurrency exchange reported third-quarter revenue of $1.9 billion, surpassing Wall Street expectations amid a sustained rally in digital asset prices that pushed Bitcoin and other tokens to record highs through much of the year.
What to Know:
- Coinbase's revenue jumped 55% to $1.9 billion in the third quarter, beating analyst estimates of $1.8 billion, while net income increased nearly fivefold to $433 million compared to the same period last year.
- The company generated $354.7 million from stablecoins and saw derivatives trading surge after acquiring options platform Deribit, which contributed $52 million in revenue during the quarter.
- Chief Executive Brian Armstrong plans to unveil details about tokenized stocks and prediction markets at a Dec. 17 product showcase as part of the company's push to become an all-purpose financial platform.
Financial Performance Exceeds Forecasts
The San Francisco-based exchange posted net income of $433 million, or $1.50 per share, compared to $75.5 million, or 28 cents per share, in the third quarter of 2024. The results reflected a 55% revenue increase from the previous year, though the company's second-quarter revenue stood at $1.5 billion. Trading volume reached $295 billion during the period, according to the shareholder letter released Thursday.
Transaction revenue hit $385 million in the first month of the current quarter.
That period saw sharp volatility as investors faced record liquidations within days of Bitcoin and other cryptocurrencies reaching all-time highs.
Coinbase shares have gained 32% in 2025. The stock's advance comes as cryptocurrencies rallied through the first nine months of the year, supported by what investors viewed as favorable signals from the second Trump administration.
Expansion Beyond Core Trading Business
Stablecoins accounted for $354.7 million in third-quarter revenue. Coinbase holds a stake in Circle Internet Group Inc., which issues the USDC stablecoin, and serves as one of the largest distribution channels for the token. The company's position in the stablecoin market strengthened after Congress passed the first U.S. law regulating stablecoins in July.
Derivatives trading provided another revenue boost.
Deribit, the options platform Coinbase acquired earlier this year, generated $52 million in the quarter. The company cited "continued growth of options trading leading to all-time high notional volumes" for the increase.
Combined, Deribit and Coinbase recorded more than $840 billion in notional derivatives trading volume during the three-month period.
Armstrong, who co-founded Coinbase and has emerged as a prominent industry advocate and major supporter of Trump-related initiatives, outlined plans during a Thursday conference call to reveal more about tokenized stocks and prediction markets. The announcement will come at a product showcase scheduled for Dec. 17. Armstrong described the company's goal as creating an "everything app" that would provide consumers with comprehensive financial services.
The platform refers to stablecoins as digital currencies pegged to traditional assets like the U.S. dollar, designed to maintain price stability unlike Bitcoin or Ethereum.
Derivatives are financial contracts whose value depends on an underlying asset, allowing traders to speculate on price movements without owning the actual cryptocurrency. Notional volume measures the total value of derivatives contracts traded, though it doesn't represent actual cash changing hands.
Coinbase executives said the company remains interested in acquisitions, particularly in trading and payments sectors. Armstrong stated the team has been "heads down working on the next pieces" of the broader platform vision.
Final Thoughts
The third-quarter results mark a significant turnaround for the exchange as it seeks to expand beyond its core trading business into new financial products. The company's strategic moves in stablecoins, derivatives, and planned offerings like tokenized stocks reflect efforts to diversify revenue streams while digital asset markets continue to evolve under changing regulatory conditions.
