Coinbase Users’ can Expect Smiles or Sorrows in 2023 Amid Extended Crypto Winter

• Coinbase has not given satisfactory results to investors in 2022.
• FTX bankruptcy, its co-founder arrest and market turmoil caused by event.
• CEO Brian Armstrong strategy for 2023.

Leading crypto exchange Coinbase is going through several ups and downs amid extended crypto winter, fraud and bankruptcies. The recent market situation has not even spared the crypto titan. 

Not So Good Year

As reported by CNN, Coinbase Global went public on April 14, 2021, with a valuation of nearly $100 billion, while they took advantage of soaring value of bitcoin (BTC), ethereum (ETH) and others. In the same year, BTC hit an all-time high of nearly $69,000, which is now plunging down to over 75%. 

Coinbase shares plummeted to nearly 85% in mid-December 2022, with multiple lows seen this month. Its 52 week high shows $281.98 and its yearly low at $32.95, according to Nasdaq. The current trend is backed by the bankruptcy filing of Sam Bankman-Fried’s crypto exchange FTX, following his arrest in the Bahamas, leading to a significant turmoil in the crypto market. 

As reported by Fortune, Brain Armstrong, Coinbase’s CEO, noted that company’s revenue may decline by 50%. Another major ‘Black Swan’ after Terra Luna Crash, has led to fear and uncertainty among crypto investors. Third-quarter 2022 revenue was estimated at just 25% when compared to that of  Q4 revenue 2021. 

According to Bloomberg, CEO Armstrong said, that “Last year in 2021, we did about $7 billion of revenue and about $4 billion of positive EBITDA, and this year with everything coming down, it’s looking, you know, about roughly half that or less.” Earlier, Coinbase calculated an estimated loss of nearly $500 million in 2022. 

As per New York Times, Coinbase laid off 18% of its manpower back in June, after TerraUSD collapsed. The crypto market crash in May, led to its stock price fall by 60%. The U.S. largest crypto exchange saw a sharp decline in its Q1 2022 revenue of $1.17 billion, which was 27% down in front of last year’s revenue.

Plan to Bounce Back

According to media reports, Coinbase chose for a second layoff round in November 2022, impacting over 60 people in the recruiting and institutional and onboarding team. CEO Armstrong remains optimistic despite the poor performance and adversities in the crypto market. 

According to Coinbase report, under the heading ‘2023 Crypto Market Outlook’, Coinbase will work on three major themes to recover backdrops of 2022 crypto winter, including relative market liquidity, ecosystem maturity and sustainable tokenomics. 

Nancy J. Allen is a crypto enthusiast and believes that cryptocurrencies inspire people to be their own banks and step aside from traditional monetary exchange systems. She is also intrigued by blockchain technology and its functioning.

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