Published: 2018-10-30 17:00:03
Coinbase achieved staggering annual revenue results during 2017 largely due to Bitcoin’s bull run and cryptocurrency catching the attention of the mainstream public for the first time.
However, the 2018 bear market may end up being even more profitable for the cryptocurrency giant. Earlier today, the exchange also revealed that it will add an extra $300 million of investment at a valuation of more than $8 billion to speed up the adoption of cryptocurrencies and digital assets.
Coinbase Projects $1.3 Billion in Revenue, Beats Bull Run Revenue
Last year was the year that just about everyone who entered the cryptocurrency space – buying in at least before December – made money. Talk of the fortunes made by average Joes caused cryptocurrency to go viral due to retail investor FOMO.
However, few made more money than San Francisco-based cryptocurrency exchange Coinbase – thanks to their easy-to-understand mobile app that allows retail investors to quickly and simply purchase cryptocurrencies like Bitcoin and Litecoin.
As a result of the exchange’s ease of entry for retail investors, combined with the lure of what at the time seemed like easy gains from crypto investing, retail FOMO drove Coinbase revenue to $1 billion in 2017, with 42% of the total revenue being generated in December when Bitcoin’s price went parabolic.
During a bull run, though, gains certainly do come easier. Simply “HODL,” as the cryptocurrency community suggests, is the best strategy. However, according to new annual revenue projections from Coinbase, the company is proving that there’s plenty of money to be made, even in a bear market.
According to Bloomberg, a new document has revealed that the crypto exchange is projected to reach nearly $1.3 billion in revenue in 2018, based on a number of internal measures including trading fees and its own crypto gains and losses.
How Coinbase Continues Strong Despite Market Downtrend
Coinbase expects to achieve even higher revenue figures in the face of a bear market, even with as much as 80% less traders using Coinbase’s platform. How they have managed to not only survive the increasingly tough industry climate, but reach even greater heights is nothing short of impressive.
Brian Armstrong, CEO of Coinbase, famously told his staff that bear markers are a time to “build a strong foundation” so the firm “can thrive in the next growth cycle.” It’s the building of that solid foundation and the perseverance by the company’s executives that has set the company up for increased revenue in the face of overall market decline.
Rather than pull back on investments, or halt the release of new products until sentiment improves, Coinbase has chugged right along in an almost unstoppable way. The crypto giant has made a number of acquisitions that include decentralized crypto exchange Paradex, crypto-marketing rewards platform Earn, and Toshi Wallet which the company has rebranded to the Coinbase Wallet.
It has also been increasingly targeting institutional investors by improving its crypto custody solutions, and has made it easier than ever for institutions to get into crypto. And while other crypto firms have entirely redirected its focus to appease institutional money, Coinbase has continued to appeal to retail investors as well. In an effort to better inform retail consumers, the company rolled out new educational tools and a new Coinbase Bundle platform.
Beyond its products and services, Coinbase the company updated its listing policy to allow for potentially “thousands” of cryptocurrencies, is working to become a regulator-approved securities broker-dealer, formed a Political Action Committee to increase lobbying leverage, and opened an office in New York City to position itself closer to Wall Street.
Looking back over the past year, of Coinbase related news, it shouldn’t come as a surprise that the biggest name in crypto has only become stronger.
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