Coinbase has made a name for itself since its launch in 2013... but now, it just announced a big loss.
👉 Background: Back in 2013, purchasing bitcoin was harder than getting a new passport before a holiday. Then, Coinbase became one of the OG crypto trading apps for amateur crypto investors.
👉 What happened: Now, Coinbase has more than 98 million users across 100 countries. It listed on the NASDAQ around 12 months ago with a wild valuation of US$86 BILLION - more than the value of NAB and Coles put together!
👉 What else: But, things can change real fast. Coinbase just announced a US$1.1 billion loss in its second quarter earnings. A major concern for the company is that institutional investor transactions were down 17%....
💡When institutional investors enter an asset class, the asset often receives broader recognition and credibility. And that's what crypto needed.
💡Ya see, retail crypto traders were dominant around four years ago. Back then, 80% of trading volume on Coinbase’s platform was retail investors. In 2021, this was only 33%. So insto's became a key part of Coinbase's growth.
💡But when interest rates rise and the cost of money becomes greater, institutional investors often revert to safer investments, like cash. And now, Coinbase has a coupla problems on its hands.
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