Coinbase Earnings Reveal: Can Trump's "Crypto" Path Drive Profit Soaring?
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Coinbase Earnings Reveal: Can Trump's "Crypto" Path Drive Profit Soaring?
Will Coinbase's earnings report reveal whether lax regulation truly drives profit surges?
Navigating Web3 tides with focused insightsAuthor: Caizi Jun, Jinshi Data
Donald Trump's return to the White House has given Bitcoin and Coinbase (COIN.O) investors more reasons to celebrate. The new president has pledged to boost the U.S. crypto industry by easing regulations. After Thursday's closing bell, investors will find out whether this optimism translates into higher profits.
According to analyst expectations compiled by FactSet, Coinbase is expected to report earnings per share (EPS) of $2.11 and revenue of $1.84 billion for the fourth quarter—significantly up from EPS of $1.04 and revenue of $954 million in the same period of 2023.
Trump’s election has been positive news for both cryptocurrency prices and Coinbase's stock. Since Trump's victory, Coinbase shares have surged about 40% to $272. Bitcoin has risen roughly the same amount, climbing 42% to $96,882.
The surge is driven by Trump’s pledge to make the U.S. the “global capital of cryptocurrency” through a more lenient regulatory regime. Trump has already appointed or nominated crypto-friendly regulators at multiple agencies, including the Securities and Exchange Commission (SEC), the Federal Deposit Insurance Corporation (FDIC), and the Commodity Futures Trading Commission (CFTC).
Under acting Chair Mark Uyeda, the SEC has begun advancing its cryptocurrency task force, aiming to establish a framework for the industry’s legal operation in the U.S., while venture capitalist David Sacks has led similar efforts within the White House.
These changes are critical for Coinbase, as the SEC sued the company in 2023, accusing it of operating an unregistered securities exchange—a claim Coinbase has contested. Under Trump’s leadership, the SEC could be far more likely to drop the case or reach an agreement allowing Coinbase to continue operations as planned.
Coinbase did not respond to requests for comment. Company executives previously told Barron’s that a shift in the SEC’s stance could encourage Coinbase to offer more token trading and additional crypto services, thereby boosting revenue.
For Coinbase, regulatory change is a double-edged sword. As regulators become friendlier, traditional brokerages may intensify competition in crypto trading.
Analysts estimate Coinbase’s total trading volume reached $216 billion in the fourth quarter, up from $185 billion in Q3 and $154 billion in Q4 2023. While clearly growing, this remains well below the record $312 billion seen in Q1 last year, when approval of spot Bitcoin exchange-traded funds (ETFs) reignited enthusiasm for crypto trading.
Investors will also watch continued growth in Coinbase’s subscription and services revenue, which includes income earned from its stablecoin USDC. Revenue in this segment is expected to reach $611 million, up from $375 million a year earlier.
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