Crypto exchange Coinbase logs third straight quarterly loss on trading slowdown

By Rishab Shaju and Prakhar ‌Srivastava

July 30 (Reuters) - Coinbase ​Global ​posted a third straight quarterly loss on Thursday as a prolonged downturn in cryptocurrency markets dented its trading volumes, sending the digital-asset exchange's shares ‌5.3% lower after the bell.

Cryptocurrency markets came under pressure during the April-to-June ⁠quarter as investors shunned riskier assets amid uncertainty over U.S. interest rates, geopolitical tensions and persistent outflows ‌from crypto investment products. The ‌weakness extended a retreat from record highs reached in October.

Coinbase's transaction revenue dropped 21% to $599 million during the quarter, from $764 million a year earlier.

"This deep and sluggish ​crypto winter has continued to put pressure on Coinbase and regulatory clarity is not happening fast enough," said Third Bridge analyst Jacob Zuller. "Tokenized equities and perpetual futures ⁠could offset spot crypto trading volumes, but Coinbase is behind on both."

Robinhood Markets, a much smaller firm in terms ​of the number of token offerings, also reported a 38% slump in second-quarter crypto transaction revenue, suggesting softer trading volumes across the ​market.

Without a crypto market turnaround, Coinbase would hope ‌for accelerated adoption of stablecoins, Zuller said.

In June, a consortium including Visa, Mastercard and Coinbase launched a new joint stablecoin in a ⁠bid to broaden adoption.

OPTIMISTIC ON CLARITY ACT

Coinbase has been looking to the Clarity Act, introduced in May last year, to provide long-sought regulatory clarity for digital-asset trading platforms.

Senate Republicans released a revised ⁠version of the Act last week, as negotiations on the legislation come down to the wire ​before Congress departs for August recess.

Coinbase CEO Brian Armstrong said in a call with analysts that he is "pretty optimistic" the legislation will get to a full Senate floor vote.

"There's a lot of ‌last-minute negotiations happening, which to me is a sign that everyone is invested in getting something over the line."

Revenue from Coinbase's subscription ‌and services unit — which includes businesses outside trading — fell 12.2% to $555.1 million.

The company reported a ⁠loss of $359.5 million, or $1.36 per share, ‌for the quarter ended June ​30, compared with a profit of $1.43 billion, or $5.14 per share, a year earlier.

(Reporting by Rishab Shaju and Prakhar Srivastava in Bengaluru; Editing by ‌Sahal Muhammed)

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