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Coinbase announced a better-than-expected revenue in its first-quarter earnings report on Thursday after a bitcoin rally led to a surge in profit.

Revenue of Coinbase Surpasses Expectations at $1.64 Billion

According to CNBC, the cryptocurrency exchange reported a remarkable revenue of $1.64 billion in the first quarter of the year, which was a 72% increase compared to the previous quarter and higher than the $1.34 billion the analysts expected.

Coinbase, the largest platform in the US for buying and selling digital tokens, also reported a net income of $1.18 billion, or $4.40 per share, up from the loss of $78.9 million, or 34 cents per share a year ago.

A $650 million mark-to-market gain on crypto assets held for investment in line with the firm's adoption of updated accounting standards was also among the profit in the quarter.

Quarterly consumer transaction revenue was $935 million, an increase of more than 100% compared to last year. With a total of $1.08 billion, transaction revenue almost tripled in the quarter.

Transaction revenue has historically been a primary revenue driver, with subscription and services income bringing in $511 million for the quarter.

Bitcoin Price Rally Also Boosts Trade Volume and Demand for Related Services

When bitcoin's value rises dramatically, it usually means more trading volume and demand for related services, which is good news for the stock.

According to Bloomberg, bitcoin reached a new all-time high of nearly $73,000 in March. The second-largest digital currency, Ethereum, also got its first significant upgrade in more than a year during the first quarter.

Since the Securities and Exchange Commission (SEC) authorized several new US spot bitcoin exchange-traded funds, the market has also seen a flood of institutional investors.

Coinbase is the designated custodian for some of these exchange-traded funds, which had raised almost $50 billion by the end of the first quarter.

Tags

Cryptocurrency, Bitcoin