Another Rough Quarter Awaits in Q3, Coinbase Warns After Bruising Financial Results

cryptonews.com:

The crypto exchange giant Coinbase is putting a positive spin on another quarter of sub-par results – and its CEO Brian Armstrong has stated that “across price cycles,” the exchange is still trending upward. But the firm appears braced for another rocky ride in the coming third quarter of FY2022.

In an earnings call, Armstrong claimed that “crypto is not linear,” and added:

“Any given quarter could be up or down or even any given year. But if you evaluate the business across price cycles, it tells a much different story.”

Armstrong was speaking against a gloomy backdrop of lower-than-estimated financial results. The firm’s revenue declined by over 60% to USD 808.3 million – lower than a USD 854.8 million estimate from Bloomberg-polled financial analysts.

Possibly more worrying was a quarterly fall of 2% in monthly transacting users (MTUs) to the 9 million mark. In July, that number shrank to just 8 million. As such, trading volumes took a lower-than-estimated tumble, and the worth of the assets on Coinbase’s platform fell – along with crypto prices – by 63% to USD 96 billion.

In a letter to shareholders, the firm outlined a modest – and mixed – outlook for Q3 of the current financial year. The firm stated that it expected another drop in MTUs in the next quarter, with more retail investors likely staying away from the markets. “We expect a higher portion of MTUs to be non-investing users compared to investing users compared to Q2,” the firm wrote.

It also wrote that it expected trading volumes to shrink again in Q3. But it predicted that its subscription and services revenue would experience “modest” growth, with “increases in interest income” expected.

The company blamed “soft crypto market conditions” for its less-than-rosy