Coinbase reports estimated first quarter revenue of $ 1.8 billion, an increase of nine times

In preparation for its Nasdaq debut next week, the Coinbase cryptocurrency exchange said on Tuesday that first quarter revenue increased about nine-fold from last year, driven by a historic rebound in bitcoin price.

Revenue in the period jumped to about $ 1.8 billion, from $ 190.6 million in the same quarter a year ago, Coinbase said in a press release, adding that the results are preliminary and unaudited. Net income grew to between $ 730 million and $ 800 million, from $ 31.9 million a year ago. Coinbase said it has 56 million verified users.

The company is hosting a webcast to discuss its financial results starting at 4:30 pm Eastern Time.

Coinbase is positioned to become the latest technology company to hit the market with a massive assessment, capitalizing on the continued growth of the sector, despite the broader economic difficulties caused by the coronavirus pandemic. Trading on the private market valued the company at $ 68 billion, a figure that rises to about $ 100 billion when accounted for in a fully diluted share count.

In the past seven months, software vendor Snowflake, food delivery app DoorDash, room sharing website Airbnb and the gaming platform Roblox have gone public. Its market limits are currently between $ 40 billion and $ 113 billion.

Coinbase is unique because its increase in value reflects the trajectory of the main cryptocurrencies. Bitcoin was up about 700% last year, while ethereum was up more than 1,100%.

Coinbase said last week that the SEC approved the direct listing, which is scheduled for April 14. The company said it plans to register some 115 million Class A common shares, which will be traded under the symbol COIN. In a direct listing, the issuing company renounces the sale of new shares and instead allows existing shareholders to sell their shares to new investors.

While Coinbase is heavily dependent today on attracting users who store and market the two main cryptocurrencies, the company is betting on developing a larger ecosystem of crypto-related assets in the coming years.

“We expect significant growth in 2021, driven by transaction and custody revenue, given the increased institutional interest in the crypto asset class,” the company said in the statement.

In the first quarter, Coinbase said it had 6.1 million monthly transaction users (MTUs). When looking at the entire year, it is outlining three possible scenarios for determining revenue, since a large part of its business is derived from these transactions.

The increase in market values ​​could result in MTUs of 7 million, Coinbase’s most aggressive estimate. In the middle range, assuming a flat encryption market, MTUs would fall by 5.5 million. And the most conservative forecast, should prices drop, is 4 million MTUs.

– CNBC’s MacKenzie Sigalos contributed to this report.

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