Coinbase Posts Over $1 Billion Profit in First Quarter Amid Crypto Trading Surge

Coinbase Global reported a significant turnaround in its financial performance for the first quarter of the year, swinging from a loss of $79 million to a profit exceeding $1 billion, largely attributed to increased cryptocurrency trading activity following the launch of the first U.S.-listed exchange-traded funds (ETFs) tracking bitcoin in January. The company's net income stood at $1.2 billion, or $4.84 per share, for the period ending March 31. Despite this positive outcome, Coinbase shares experienced a 2.5% decline in after-hours trading, with concerns raised over potential decreases in trading volumes amid downward movements in bitcoin prices. The surge in crypto prices, fueled by the approval of several exchange-traded funds tied to bitcoin's spot price by the U.S. Securities and Exchange Commission, led to renewed investor enthusiasm in digital assets, with Coinbase serving as the custodian for several of these ETFs, including BlackRock's iShares Bitcoin Trust. CEO Brian Armstrong highlighted the company's focus on maintaining a low cost structure while continuing to innovate, contributing to its success. Higher interest rates have also enabled Coinbase to increase its interest income, particularly from USD Coin (USDC), a stablecoin it co-governs with Circle, with interest and finance fee income rising to $66.7 million in the first quarter compared to $43.3 million in the same period the previous year.