Coinbase Earnings Outpace Nasdaq—What Analysts Say

Coinbase has now surpassed the world's two largest securities exchanges in terms of trading revenue, according to a crypto analyst from private bank Coates.

The crypto exchange generated $5.75 billion in trading revenue over the past 12 months, compared to just $4.54 billion for the Nasdaq, where many of the world's most valuable companies trade, including Apple, Google and Microsoft.

Coinbase It surpassed HKEX, which earned $2.67 billion last year, as well as Brazil's Bolsa Balcao, the Hong Kong stock exchange, which earned $1.81 billion.

Keep in mind that these numbers are not directly comparable and are based on the amount of money exchanged per transaction—for example, when you buy or sell stocks or Bitcoin— It's not just the number of transactions or platform popularity.

To put these numbers into context, all major crypto, stock and commodity exchanges generated around $51.27 billion in trading revenue worldwide, according to Coutts data.

Putting Coinbase's earnings in context

While Coinbase's transaction revenue growth is very high, it is still significantly lower than the world's largest exchanges.

The London Stock Exchange (LSE) generated $10.82 billion in trading revenue over the past 12 months. The Intercontinental Exchange (ISA), which operates the New York Stock Market (NYSE) as well as several futures, debt and commodity exchanges, ranks first with trading revenue of $9.16 billion.

Mouloukou Sanoh, CEO of MANSA Finance, a liquidity provider that builds on Coinbase's BASE blockchain, noted that although Coinbase's trading revenue exceeds that of many major exchanges, its trading volume lags behind NASDAQ.

“Coinbase is still the least popular of all the exchanges listed in Coutts' data in terms of volume. But because they charge higher fees, it's a place where they get more marketing income,” he said.

“I believe there is still a very, very long way to go,” Sanoh added.

Still, he predicts Coinbase will continue to overtake traditional exchanges in revenue, potentially reaching the number three spot in total transaction revenue by 2025.

However, he believes it could be between 10 and 20 years before Coinbase overtakes Nasdaq in terms of total trading volume.

“I feel that in the next 10 to 20 years we will see crypto exchanges completely overturn traditional markets, but it's still a long time coming,” he said. But I wouldn't be surprised if at some point after the turn of the decade, Coinbase is the largest global exchange in terms of volume and trading revenue.

Coinbase still has a long way to go if it is going to surpass NASDAQ in terms of trading volume; According to CoinGecko, it had about $8 billion in trading volume in the last 24 hours, compared to $445 billion for the Nasdaq.

Sanoh believes this is possible because Coinbase has the potential to grow in Latin America, Africa, Europe and beyond its traditional core market in the US.

“I think their distribution in the US is very strong, but internationally they've been very weak and reluctant to expand,” he said. But now, with the new administration, they will be more bullish on overseas expansion. I think that's where the next billion dollars in revenue and volume will come from.

Coinbase's sales fell to $1.2 billion in Q3 2024 from $1.45 billion in the previous quarter, falling short of analyst expectations. It announced a profit of $75 million compared to $2 million last year.

Coinbase did not immediately respond to a request for comment from Decrypt.

Edited by Stacy Elliott.