U.S.-based cryptocurrency exchange Coinbase topped revenue forecasts for the fourth quarter of 2022, but its trading volumes continued to decline.
The exchange’s net income for the quarter was $605 million, beating Wall Street analysts’ reported $589 million in revenue
Transaction volumes were down 12% compared to the previous quarter, but Coinbase pointed to a 34% increase in subscription and services revenue as the reason for the 5% increase in overall revenue for the quarter. Despite Coinbase reaffirming its belief that its staking products are not securities, staking revenue declined from the previous quarter as the drop in cryptocurrency prices outpaced the increase in all crypto token pledged balances.
The exchange is currently facing a U.S. Securities and Exchange Commission investigation into its staking products, similar to the probe that led to peer cryptocurrency exchange Kraken’s $30 million settlement with the regulator.
Coinbase noted that 2022 is a "challenging year for the crypto market," with macroeconomic events and events such as the bankruptcy of crypto hedge fund Three Arrows Capital and exchanges Voyager and Celsius creating strong headwinds for the industry.
