Coinbase users can expect smiles or heartbreak in 2023 amid an extended crypto winter
- Coinbase did not give satisfactory results to investors in 2022.
- The bankruptcy of FTX, the arrest of its co-founder and the market turbulence caused by an event.
- CEO Brian Armstrong’s strategy for 2023.
Major crypto exchange Coinbase is going through several ups and downs amid a prolonged crypto winter, frauds and bankruptcies. The recent market situation has not even spared the crypto titan.
Not so good year
As reported by CNN, Coinbase Global went public on April 14, 2021, with a valuation of nearly $100 billion, as they profited from the surge in the value of bitcoin (BTC), the ethereum (ETH) and others. In the same year, BTC hit an all-time high of nearly $69,000, which is now down over 75%.
Coinbase shares fell almost 85% in mid-December 2022, with several lows seen this month. Its 52-week high is $281.98 and its yearly low is $32.95, according to Nasdaq. The current trend is supported by Sam Bankman-Fried’s FTX crypto exchange filing for bankruptcy following his arrest in the Bahamas, causing significant turmoil in the crypto market.
As Fortune reported, Brain Armstrong, CEO of Coinbase, noted that the company’s revenue could drop by 50%. Another major ‘Black Swan’ after Terra Luna Crash, has sparked fear and uncertainty among crypto investors. Third quarter 2022 revenue was estimated at only 25% compared to that of the turnover of the fourth quarter of 2021.
According to Bloomberg, CEO Armstrong said that “last year in 2021 we had about $7 billion in revenue and about $4 billion in positive EBITDA, and this year with everything going down it seems, you know, about half or less.” Previously, Coinbase calculated an estimated loss of nearly $500 million in 2022.
According to the New York Times, Coinbase laid off 18% of its workforce in June, after the collapse of TerraUSD. The crypto market crash in May caused its stock price to drop 60%. The largest crypto exchange in the United States saw a sharp decline in revenue in the first quarter of 2022 of $1.17 billion, a 27% drop from last year’s revenue.
Plan to bounce back
According to media reports, Coinbase chose a second round of layoffs in November 2022, impacting more than 60 people in the recruiting and institutional and onboarding team. CEO Armstrong remains optimistic despite the poor performance and adversities in the crypto market.
According to the Coinbase report, under the title “2023 Crypto Market Outlook”, Coinbase will work on three major themes to capture the backdrops of crypto winter 2022, including relative market liquidity, ecosystem maturity, and tokenomics. sustainable.
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