Coinbase’s latest financial report revealed that its net revenue for Q4 2022 slightly exceeded that of Q3 2022, despite experiencing a 12% reduction in transaction revenue. The cryptocurrency exchange’s net sales for the last quarter of 2022 were reported to be $605 million, indicating a 5% increase from the previous quarter’s $576 million.
Of this amount, transactions accounted for over half, generating $322 million, while subscriptions and services made up the remainder, generating $283 million, representing an increase of 12% and 38%, respectively, compared to the previous quarter.
Despite the revenue growth in Q4 2022, Coinbase’s annual net sales dropped by over 50%, falling from $7.4 billion in 2021 to $3.1 billion in 2022, which is in line with the overall market slowdown. The company attributed this to various isolated events that exacerbated already challenging macro conditions throughout the year 2022.
In response, Coinbase reduced its workforce by 20% and implemented other measures to better control costs and keep spending under control in Q1 2023. With the New York Department of Financial Services (NYDFS) settlement taken into account, the company anticipates a cost reduction of 25% by the end of the quarter, compared to Q4 2022.
According to recent research, 2023 could be a significant year for crypto policy both in the United States and overseas, likely due to increased interest in the subject following FTX’s collapse last year. This has led to a response from authorities that Coinbase views as punitive and reactionary, rather than addressing genuine consumer interests and the reality of how cryptocurrencies operate.
Coinbase’s CEO, Brian Armstrong, has expressed disagreement with the United States Securities and Exchange Commission’s (SEC) recent action against Kraken’s staking business, which he believes did not violate any securities laws. While the SEC sent a Wells notice to the asset’s issuer, Paxos, claiming that stablecoins such as BUSD are securities, Coinbase’s business maintains that stablecoins such as BUSD do not fall under this category.