The mini rally in cryptocurrencies is not enough to drag crypto exchange Coinbase from the doldrums. After making its debut in April 2021 as one of the largest US listings in history, the share price has crashed. Since the first day’s trading it is down 81 per cent. Trace that decline over bitcoin’s price and it becomes clear that Coinbase has even underperformed the crypto slump.
Coinbase’s fortunes are entwined with volatile crypto prices. Rising interest rates give retail and institutional investors little incentive to risk their money. Adoption of crypto as a payment alternative or an inflation hedge is poor. As user numbers fall, trading volume and revenue go with it. Coinbase reported a 76 per cent drop in net revenue in the last quarter of 2022 compared with the previous year. Losses reached $557mn.