With Russian president Vladimir Putin declaring war and invading Ukraine, in what is being termed as the biggest attack on a European state since WWII, the crypto market is experiencing volatility once again. Despite this however, the popular crypto exchange platform Coinbase defined all estimates and expectations in its Q4 2021 earnings.
The platform clocked a record $2.5 billion in revenue, moving past expectations of $1.95 billion, while its EPS exceeded the estimate of $1.85 to come at $3.32. For the full 2021, its revenue and trading volume came at $7.35 billion and $1.67 trillion respectively. Its trading volume in Q4 amounted to $547 billion ($177 billion in retail trading volume and $371 billion in institutional trading volume).
After its Q4 2021 earnings were made public, Coinbase’s shares soared initially, but have fallen once again by as much as 9% and are currently trading at $179.56. Its monthly transacting users (MTUs) by the end of the year came at 11.4 million as well, of whom 32% both invested and engaged with a non-investing product.
Its annual average retail MTUs came at 8.4 million, and the average transaction revenue per user amounted to $64. Its assets on its platform amounted to $278 billion as well. Speaking of other financials, Coinbase clocked $3624 million in net income and adjusted EBITDA of $4.09 billion over the entire year. For the winter quarter, the numbers are $840 million and $1.2 billion respectively.
Going forward, Coinbase expects to enter 2022 with “even more unknowns, which make our business all the more difficult to forecast,” as factors like “global macroeconomic headwinds,” unpredictable crypto asset prices, rising interest rates, and inflation, continue to bring fluctuations in the prices of cryptocurrencies.
The company predicted that both retail (MTUs) and total trading volume during the first quarter of the year would be lower than that in Q1 2021, especially as the market capitalization of the crypto market has fallen by 20%. At the end of the final quarter of last year, the total crypto market capitalization was $2.3 trillion, and it had hit a peak of $3.1 trillion in November. For fiscal 2022, Coinbase hopes that retail MTUs will number between 5-15 million.
It also expects $200 billion in total trading volume and lower subscriptions and services revenues than in the fourth quarter of 2021.
It generated over $500 million in Subscription and services revenues, including over $200 million in Q4 2021. Its institutional customer base grew by 50% as well. Bitcoin, the most popular cryptocurrency represented 16% of trading volume in Q4 2021 and 25% in the full year, while Ethereum represented 16% of trading volume in the winter quarter and 21% in the full year. Other cryptocurrencies made up 68% of trading volume in the fourth quarter and 54% for the full fiscal year.
This comes even as the prices of cryptos have fallen steeply owing to the war between Ukraine and Russia. Coinbase also noted the widespread adoption and strong growth of NFTs, DeFi, play-to-earn gaming, and others. This year, it looks to launch Web3 products broadly across the world, make investments in select markets with localized infrastructure and a full suite of Coinbase products and services, and expand its investing product suite beyond spot trading.