Coinbase reports third-quarter earnings after the market close on Thursday, and Wall Street analysts are divided over whether a recent recovery in crypto trading will translate into meaningful revenue. According to CoinDesk, analysts expect trading activity to have improved from the second quarter, but disagree on how much money the rebound will actually generate.
Coinbase (Credits: CoinDesk)
Coinbase Earnings Preview: A Divided Wall Street
Trading activity picked up in September after hitting multiyear lows in June, helped by a rebound in crypto prices. The question for Coinbase is how much that recovery helped, and whether it will last — and analysts are split on both counts.
The uncertainty sharpened after rival Robinhood reported a 55% drop in crypto transaction revenue from a year earlier, as crypto trading volume fell 38% in the period. Revenue from options and equities trading climbed in contrast, while prediction markets brought in $173 million, more than six times the year-earlier figure.
Why Robinhood’s 55% Crypto Revenue Drop Matters for Coinbase
That split matters for Coinbase because the exchange still gets a large share of its revenue from customers buying and selling cryptocurrencies. Unlike a traditional stockbroker that can lean on interest income, investment products and other services, Coinbase remains sensitive to swings in crypto prices: when prices fall, trading volumes tend to shrink, leaving lower fee revenue behind.
CoinDesk notes two possible offsets. Coinbase’s stablecoin income and its growing derivatives business could help cushion sluggish trading, though analysts remain divided on the longer-term outlook even with those buffers.
Thursday’s report will therefore be read as a test of the whole sector’s mood, not just one company’s quarter. If trading did recover in September, the debate is whether that was a durable turn or a brief bounce in a difficult stretch for the industry — and Wall Street, for now, cannot agree.
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Source: CoinDesk — read the full story there.
