Skip to main content

Coinbase reveals $1.2 billion revenue in plans to go public

Coinbase reveals $1.2 billion revenue in plans to go public

/

A huge milestone for the bitcoin economy

Share this story

Illustration by Alex Castro / The Verge

Coinbase has publicly filed paperwork to list its stock on the NASDAQ exchange, a huge step forward in the first major public offering for a cryptocurrency company. Coinbase’s S-1 was published on Thursday morning, after being confidentially submitted to the SEC in December.

In an attached letter to investors, founder Brian Armstrong presented cryptocurrency as an equalizing force in financial markets — and Coinbase as the company at the forefront of that change.

“If the world economy ran on a common set of standards... the world would be a more fair and free place”

“The current financial system is rife with high fees, unequal access, and barriers to innovation,” the letter reads. “If the world economy ran on a common set of standards that could not be manipulated by any company or country, the world would be a more fair and free place, and human progress would accelerate.”

The filing lays out the company’s finances in unprecedented detail, including a surprisingly profitable 2020 driven by a huge spike in the price of bitcoin. Coinbase brought in $1.2 billion in revenue over the course of the year for a profit of $322 million, the first time the company has turned an annual profit.

Coinbase boasted 43 million verified users as of the end of 2020, with 2.8 million users making transactions each month and a total of $90 billion of assets held in trust. All told, the company has handled transactions worth $456 billion over its life span as a company.

Still, the skyrocketing price of bitcoin also has its drawbacks. The filing acknowledges that the volatility of cryptocurrency prices will be a significant risk for Coinbase going forward.

“All of our sources of revenue are dependent on crypto assets and the broader cryptoeconomy,” the filing reads. “There is no assurance that any supported crypto asset will maintain its value or that there will be meaningful levels of trading activities. In the event that the price of crypto assets or the demand for trading crypto assets decline, our business, operating results, and financial condition would be adversely affected.”

Much of Coinbase’s success has been due to its ongoing focus on complying with financial regulations concerning cryptocurrency. Coinbase was one of the first exchanges to embrace conventional know-your-customer finance rules, despite reluctance from the libertarian corners of the cryptocurrency world. As those regulations continue to tighten, many of Coinbase’s competitors have been prosecuted for money laundering, and the company continues to invest heavily in legal compliance. Kathryn Haun, a former prosecutor who led the Silk Road task force corruption case, now sits on Coinbase’s board of directors.

In a nod to the historic nature of the filing, elusive Bitcoin founder Satoshi Nakamoto is listed on the S-1 as an interested party alongside lawyers and investors involved in the deal. As a result, a copy of the filing has been sent to Nakamoto’s bitcoin wallet. The filing also lists the identification of Nakamoto as a potential risk, saying the value of Bitcoin and thus Coinbase might be damaged by “the identification of Satoshi Nakamoto, the pseudonymous person or persons who developed Bitcoin, or the transfer of Satoshi’s Bitcoins.”

Update 12:01 PM ET: Added sentence about Nakamoto’s identification as a risk factor for Coinbase.

Today’s Storystream

Feed refreshed Two hours ago Not just you

T
Youtube
Thomas RickerTwo hours ago
Table breaks before Apple Watch Ultra’s sapphire glass.

”It’s the most rugged and capable Apple Watch yet,” said Apple at the launch of the Apple Watch Ultra (read The Verge review here). YouTuber TechRax put that claim to the test with a series of drop, scratch, and hammer tests. Takeaways: the titanium case will scratch with enough abuse, and that flat sapphire front crystal is tough — tougher than the table which cracks before the Ultra fails — but not indestructible.


E
Twitter
Emma RothSep 25
Rihanna’s headlining the Super Bowl Halftime Show.

Apple Music’s set to sponsor the Halftime Show next February, and it’s starting out strong with a performance from Rihanna. I honestly can’t remember which company sponsored the Halftime Show before Pepsi, so it’ll be nice to see how Apple handles the show for Super Bowl LVII.


E
Twitter
Emma RothSep 25
Starlink is growing.

The Elon Musk-owned satellite internet service, which covers all seven continents including Antarctica, has now made over 1 million user terminals. Musk has big plans for the service, which he hopes to expand to cruise ships, planes, and even school buses.

Musk recently said he’ll sidestep sanctions to activate the service in Iran, where the government put restrictions on communications due to mass protests. He followed through on his promise to bring Starlink to Ukraine at the start of Russia’s invasion, so we’ll have to wait and see if he manages to bring the service to Iran as well.


E
External Link
Emma RothSep 25
We might not get another Apple event this year.

While Apple was initially expected to hold an event to launch its rumored M2-equipped Macs and iPads in October, Bloomberg’s Mark Gurman predicts Apple will announce its new devices in a series of press releases, website updates, and media briefings instead.

I know that it probably takes a lot of work to put these polished events together, but if Apple does pass on it this year, I will kind of miss vibing to the livestream’s music and seeing all the new products get presented.


Welcome to the new Verge

Revolutionizing the media with blog posts

Nilay PatelSep 13
E
External Link
Emma RothSep 24
California Governor Gavin Newsom vetoes the state’s “BitLicense” law.

The bill, called the Digital Financial Assets Law, would establish a regulatory framework for companies that transact with cryptocurrency in the state, similar to New York’s BitLicense system. In a statement, Newsom says it’s “premature to lock a licensing structure” and that implementing such a program is a “costly undertaking:”

A more flexible approach is needed to ensure regulatory oversight can keep up with rapidly evolving technology and use cases, and is tailored with the proper tools to address trends and mitigate consumer harm.


A
Youtube
Andrew WebsterSep 24
Look at this Thing.

At its Tudum event today, Netflix showed off a new clip from the Tim Burton series Wednesday, which focused on a very important character: the sentient hand known as Thing. The full series starts streaming on November 23rd.


A
The Verge
Andrew WebsterSep 24
Get ready for some Netflix news.

At 1PM ET today Netflix is streaming its second annual Tudum event, where you can expect to hear news about and see trailers from its biggest franchises, including The Witcher and Bridgerton. I’ll be covering the event live alongside my colleague Charles Pulliam-Moore, and you can also watch along at the link below. There will be lots of expected names during the stream, but I have my fingers crossed for a new season of Hemlock Grove.