2022-12-8 07:51 |
CEO Brian Armstrong said Coinbase’s revenue for 2022 will plunge by 50% as the bear market continues.
Coinbase’s shares are down by roughly 80% since the start of the year.
FTX’s demise is due to massive fraud and not mismanagement
FTX’s 2022 revenue to decline by 50%Coinbase Global Inc. Chief Executive Officer Brian Armstrong told Bloomberg in a recent interview that he expects the company’s revenue for 2022 to decline by 50% or more.
He attributed the decline in revenue to the ongoing bear market, which has seen several cryptocurrencies lose more than 70% of their values over the last seven months.
The FTX incidence has also affected the confidence of some cryptocurrency investors. The shares of Coinbase are down by roughly 80% since the start of the year. At the start of the year, COIN was trading at $251 but ended Wednesday’s trading hours just above $40 per share.
Armstrong said;
“Last year in 2021, we did about $7 billion of revenue and about $4 billion of positive EBITDA, and this year with everything coming down, it’s looking, you know, about roughly half that or less.”
The publicly-listed cryptocurrency exchange had previously said it expected a loss of no more than $500 million based on adjusted EBITDA for 2022. While Coinbase didn’t provide a full-year outlook for overall revenue, Armstrong’s estimate correlates with the approximately $3.2 billion expected by Wall Street analysts.
FTX’s collapse is the result of a massive fraudLast month, rival crypto exchange FTX filed for bankruptcy and has been the major topic of discussion in the crypto space since then. While commenting on the event, Armstrong said FTX’s collapse was not a result of mismanagement, as Sam Bankman-Fried has conveyed. He said
“It appears that they took customer funds from their exchange and actually commingled them or moved them into their hedge fund and then ended up in a very underwater position. And that was, I believe, against their terms of service and against the law. I think there are some really serious questions to be asked now about should some of that money be clawed back because it appears that it was stolen from customers.”
Despite the negative effects of FTX’s collapse, Armstrong said he intends to continue advocating for the crypto industry in Washington DC. He also predicted that crypto-specific legislation could be implemented next year.
According to Armstrong, the regulations should focus on stablecoins, centralised exchanges and custodians, while also defining commodities and securities. He said;
“There’s still probably 20%, I would say, of Congress where they’re either just very hostile to it, or are just ignorant of it, but it’s not the majority view at this point. We can hopefully get something there in the US and then go for the rest of the G20 as well.”
Coinbase is the second-largest cryptocurrency exchange in the world and processes nearly $1.2 billion daily.
The post Coinbase FY2022 revenue to be less than half of FY2021 revenue, says Brian Armstrong appeared first on CoinJournal.
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