CoinDesk reports that Wall Street experts predict a significant surge in Q4 earnings for the top US exchange, Coinbase, compared to the previous quarter. The last quarter of the year brought a fruitful period for the crypto industry.
According to estimates from FactSet, the revenue for the fourth quarter is projected to be $1.8 billion, a considerable increase from $1.26 billion posted in Q3. Earnings per share are anticipated to have ascended to $1.99 from $0.41.
A significant factor contributing to this boost is the large crypto rally following the presidential election of Donald Trump. Analysts predict that the exchange volume could have escalated to $195.9 billion in the last quarter, up from $185.3 billion in Q3. This would be the strongest quarterly outcome since Q4 of 2021.
Analysts from Citi bank maintain a positive outlook on Coinbase, noting that the company is well-positioned to benefit as crypto potentially transitions into a new era. Despite their bullish stance, the Citi team projects Q4 revenue to be $1.7 billion, slightly below the consensus estimate of $1.8 billion.
While crypto and Coinbase experienced numerous triggers in the final part of 2024, predictions for 2025 remain uncertain due to the typically slow effect of policy changes, according to some Wall Street analysts.
Coinbase has been focusing on diversifying its revenue stream, with 50% still coming from trading fees. However, retail traders, who pay the highest trading fee, have not returned to 2021 levels, as per Kaiko’s research. As a result, transaction revenue continues to be affected.
Citi suggests that Coinbase could address this issue in 2025 by further embracing tokenization of assets, smart contract applications, and Web3, among other strategies. This evolution will be crucial for Coinbase’s growth trajectory, the bank’s analysts noted.
