Coinbase reported a $359.5 million net loss for the second quarter of 2024, its third consecutive quarter in the red. Total revenue fell 14% from the prior quarter to $1.22 billion, dragged down by a 21% drop in transaction revenue to $599 million. The results, released after the bell Thursday, sent shares down about 6% in after-hours trading from a $163.55 close.
Revenue mix tilts away from Bitcoin
Non-Bitcoin spot trading now accounts for 88% of Coinbase's net revenue, up from 45% in the same period four years ago. That shift helped cushion the blow from a broader market downturn: industry-wide spot volume fell 25% quarter-over-quarter, but Coinbase's consumer transaction revenue declined only 20% — a sign it's holding up better than peers. Consumer spot volume fell 24%, but the revenue drop was shallower, suggesting the exchange is capturing higher-margin trades on altcoins and memecoins.
Derivatives and prediction markets buck the trend
While the broader derivatives market shrank about 12% in Q2, Coinbase's derivatives volume held roughly flat. The exchange's share of the derivatives market hit a record for the third straight quarter. Trailing-twelve-month derivatives volume now exceeds $4.2 trillion. The company's $2.9 billion acquisition of Deribit, plus a CFTC no-action letter in May that clears the way for regulated perpetual futures to U.S. customers, positions it to grow further. Prediction markets also posted a standout quarter, growing 106% quarter-over-quarter and crossing a $100 million annualized run rate.
Stablecoin revenue dips but USDC holdings swell
Stablecoin revenue slipped to $292 million from $305 million, but the average amount of USDC held on Coinbase hit $20 billion — up 44% year-over-year. That growth in stablecoin deposits provides a low-cost base for lending and staking, even as subscription and services revenue overall fell 5% to $555 million. Assets on the platform dropped to $245.9 billion from $294 billion, reflecting the broader market decline: Bitcoin lost roughly 14% in Q2, while Ethereum fell about 25%.
Coinbase's adjusted EBITDA came in at $207.8 million, down 31% quarter-over-quarter but still positive for the 14th straight quarter. The exchange now faces the challenge of maintaining profitability while navigating a bearish crypto environment. The CFTC no-action letter opens the door to U.S. perpetual futures, a product that could revive institutional volume. Whether that offsets the drag from falling spot trading will be the key question heading into Q3.
