From Coinbase shareholder letter:

Q3 was a strong quarter for Coinbase. Amid multi-year low levels of volatility, we are pleased with our financial results. While we have generated a net loss through Q3, we are on track to deliver meaningful positive Adjusted EBITDA for 2023, reflecting the direction we set at the beginning of the year to be a company that can generate Adjusted EBITDA in all market conditions.

Combined with a strong balance sheet with over $5.5 billion in $USD resources1, we are determined to invest in the future and deliver the most trusted products and services that expand onchain utility.

In Q3, we obtained new licenses that enable us to access new markets and deliver new products, continued to drive toward regulatory clarity in the US, and built innovative products and services in the areas of derivatives and layer 2 solutions.

We are building a sustainable business to drive long term growth;

in Q3, net loss was $2 million and we generated positive Adjusted EBITDA for the third consecutive quarter. Total revenue was $674 million, down 5% Q/Q. Net revenue was $623 million, down 6% Q/Q. Total operating expenses were $754 million, down 4% Q/Q, while technology & development, sales & marketing, and general & administrative expenses collectively declined 1% Q/Q to $654 million. Net loss was $2 million. Adjusted EBITDA was $181 million. Our balance sheet remained strong with over $5.5 billion in $USD resources which increased $20 million Q/Q. In Q3, we repurchased $263 million of our 2031 Senior Notes at an approximately 33% discount to par value or $177 million in cash.

Transaction Revenue


Overall crypto market cap declined 9% Q/Q to $1.1 trillion when comparing the end of Q3 to the end of Q2, and the average crypto market cap declined 3% over the same time frame. The price of BTC, which accounts for roughly half of crypto market cap, declined 12% when comparing the end of Q3 to the end of Q2, but increased 63% year-to-date through the end of Q3. In addition, crypto asset volatility2, another driver of revenue, continued to decline in Q3 and reached the lowest level we have measured since 2016. This macro backdrop contributed to global spot market trading volumes declining 24% Q/Q in Q3.

Q3 total transaction revenue was $289 million, down 12% Q/Q. Transaction revenue was driven by a 17% Q/Q decline in total trading volume3, partially offset by higher realized fees resulting from the mix of trading activity on our platform in the quarter.

Institutional transaction revenue was $14 million in Q3, down 18% Q/Q. Institutional trading volume was $65 billion, down 17% Q/Q, also better than the US spot market. The institutional trading volume decline was primarily driven by lower Markets volume, which largely consists of market maker volume on our platform. During Q3, USDT volume was elevated temporarily across the entire industry, including on Coinbase, largely due to de-pegging events.

Source: Coinbase