Coinbase reported third-quarter adjusted net income of $719 million, up 66 percent from a year earlier, as a rally in cryptocurrency prices lifted the value of its investment portfolio. Revenue of $1.20 billion fell short of the $1.233 billion analysts had expected, according to LSEG. The company is also pushing into artificial intelligence tools, tokenized assets and prediction markets to broaden its business beyond cryptocurrency.
The surge in net income came as the cryptocurrency market rebounded. The price of bitcoin rose 39 percent during the three-month period ended September 30 and recently changed hands at roughly $80,809.
Coinbase is a San Francisco-based cryptocurrency platform. Its net income can swing sharply with the value of its crypto investment holdings.
In the third quarter, Coinbase deepened its push into non-crypto products. In July, Vice President of Product Max Branzburg told CNBC the company would debut an "everything exchange" featuring tokenized stocks, derivatives trading, prediction markets and early-stage token sales. The platform also introduced Coinbase for Agents in early October, supporting users who want to use ChatGPT, Muse or other AI agents to manage portfolios or research and trade various assets.
Prediction markets revenue grew to more than $200 million on an annualized basis in the third quarter, while the number of traders on those markets increased 60 percent from the second quarter.
Analysis
Why This Matters
- Coinbase's earnings are a proxy for the health of the cryptocurrency market; the 66% profit jump signals renewed investor appetite after a prolonged downturn.
- The company's push into AI agents, tokenized assets and prediction markets suggests it is trying to reduce its reliance on volatile crypto trading fees.
- Prediction markets' rapid growth may attract regulatory attention as they operate in a legal grey area.
Background
Coinbase is a San Francisco-based cryptocurrency exchange that generates most of its revenue from trading fees, making it sensitive to swings in digital asset prices.
Key Perspectives
Analysts: Polled by LSEG, they had expected Coinbase to report revenue of $1.233 billion and a per-share profit of 6 cents. The company reported $1.20 billion in revenue and $2.51 per share, though it was not immediately clear if the profit figure was comparable.
Coinbase: Its earnings growth in the third quarter was largely driven by the rising value of its cryptocurrency investment holdings, the company said. In July, Vice President of Product Max Branzburg said Coinbase would debut an "everything exchange" to offer tokenized stocks, derivatives and prediction markets. The company also launched Coinbase for Agents in October.
What to Watch
- Whether Coinbase can sustain its profit growth if the current bitcoin rally stalls or reverses.
- How regulators respond to the company's expansion into prediction markets, which may fall under commodities or gambling oversight.
- Adoption rates for Coinbase for Agents, as retail investors evaluate automated trading tools.
Checked
11 claims in this story checked against 1 source: 11 supported.
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- SupportedCoinbase reported third-quarter adjusted net income of $719 million, up 66% from a year earlier.US Top News and Analysis: “Coinbase Global earned third-quarter adjusted net income of $719 million , up 66% from $433 million a year ago”
- SupportedA cryptocurrency-market recovery lifted the value of Coinbase’s investment portfolio.US Top News and Analysis: “The third quarter value of Coinbase's crypto investment portfolio climbed due to a resurgence in the digital asset market.”
- SupportedCoinbase revenue of $1.20 billion fell short of the $1.233 billion analysts expected.US Top News and Analysis: “Revenue of $1.20 billion trailed the $1.233 billion expected by analysts polled by LSEG.”
- SupportedCoinbase is pushing into AI integrations, tokenized assets and prediction markets as non-crypto products and services.US Top News and Analysis: “In the third quarter, Coinbase deepened its push into non-crypto products and services, including artificial intelligence integrations for traders, tokenized real-world assets and prediction markets.”
- SupportedBitcoin rose 39% during the three-month period ended September 30.US Top News and Analysis: “The price of bitcoin — often used as a gauge for all crypto assets — rose 39% in the three-month period ended Sept. 30”
- SupportedBitcoin recently changed hands at roughly $80,809.US Top News and Analysis: “the flagship cryptocurrency recently changed hands at roughly $80,809.”
- SupportedIn July, Coinbase Vice President of Product Max Branzburg told CNBC the company would debut an “everything exchange.”US Top News and Analysis: “In July, VP of product Max Branzburg told CNBC that Coinbase would debut an "everything exchange"”
- SupportedThe planned exchange would feature tokenized stocks, derivatives trading, prediction markets and early-stage token sales.US Top News and Analysis: “spotlighting tokenized stocks and other real-world assets, derivatives trading, prediction markets and early-stage token sales.”
- SupportedCoinbase introduced Coinbase for Agents in early October for users wanting AI agents to manage portfolios or research and trade assets.US Top News and Analysis: “The trading platform also introduced Coinbase for Agents in early October, supporting users that want to use ChatGPT, Muse or other AI agents to manage their portfolios or research and trade various assets.”
- SupportedPrediction-markets revenue grew to more than $200 million on an annualized basis in the third quarter.US Top News and Analysis: “In the third quarter, prediction markets revenue grew to more than $200 million on an annual basis”
- SupportedThe number of traders on Coinbase’s prediction markets increased 60% from the second quarter.US Top News and Analysis: “the number of traders on those markets increased 60% compared with the second quarter.”
