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Coinbase Global Inc Ordinary Shares - Class A - Stock Quote COIN

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Morningstar's Coinbase Global Inc Ordinary Shares - Class A Stock Analysis

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Coinbase Plans to Shrink Workforce as Gloom in Cryptocurrency Markets Deepens

Michael Miller Equity Analyst

Analyst Note

| Michael Miller |

On June 14, no-moat Coinbase announced a roughly 18% reduction in its workforce, which will bring employee count down to around 5,000 by the end of the second quarter. The firm previously froze its hiring plans for 2022. Both moves come in the face of an increasingly bearish cryptocurrency market, which has been deeply affected by the high-profile failures of some decentralized finance platforms as well as broader macroeconomic pressures. Coinbase receives the majority of its revenue from retail trading fees, which have shown a strong correlation to the ebb and flow of cryptocurrency prices, leaving the firm exposed to market conditions and the intense volatility that follows. This complicates Coinbase’s hiring and spending needs as the firm's revenue and customer base vary dramatically from quarter to quarter. This most recent move from the company reflects that difficulty.

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Coinbase Global Inc Ordinary Shares - Class A's Company Profile

Business Description

Founded in 2012, Coinbase is the leading cryptocurrency exchange platform in the United States. The company intends to be the safe and regulation-compliant point of entry for retail investors and institutions into the cryptocurrency economy. Users can establish an account directly with the firm, instead of using an intermediary, and many choose to allow Coinbase to act as a custodian for their cryptocurrency, giving the company breadth beyond that of a traditional financial exchange. While the company still generates the majority of its revenue from transaction fees charged to its retail customers, Coinbase uses internal investment and acquisitions to expand into adjacent businesses, such as prime brokerage, data analytics, and collateralized lending.

c/o The Corporation Trust Company, 1209 Orange Street
Wilmington, DE, 19801
T +1 302 777-0200
Sector Technology
Industry Software - Application
Most Recent Earnings Mar 31, 2022
Fiscal Year End Dec 31, 2022
Stock Type
Employees 3,730

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