Previewing Coinbase’s Q4 2021 Earnings

Tomorrow, after market close, Coinbase (COIN) will report 2021 Q4 earnings.

Since Q3 earnings on November 9, 2021, the company’s share price has been on a consistent slide, dropping more than 50%. Over the same period, the price of Bitcoin (BTC) and Ethereum (ETH) are both down more than 43%.

Analysts are expecting Q4 revenue of $1.9 billion, a 300% increase from Q4 2020, and an EPS of $1.88.

The earnings call is scheduled for 5:30 p.m. EST. Here’s what to keep an eye on:

Trading Volumes & Monthly Active Users

As a leading retail exchange with arguably the highest trading fees on the market, trading volumes and monthly active users (MAUs) are highly important metrics. And with crypto prices soaring to all-time highs before coming back down, Q4 should be an interesting quarter for the company.

According to Nomics, Coinbase’s Q4 daily trading volumes were 16% above the company’s best quarter to date (Q2), when revenue topped $2 billion. Based on this, it’s possible that Coinbase could report higher revenue, monthly transacting users, and trading volume as increases in those metrics have been correlated to crypto price volatility.

Other Areas Of The Business

As Coinbase continues its attempt to diversify its revenue away from trading fees, we expect an update on their other streams of revenue, including staking.

Furthermore, in October, Coinbase announced plans to launch an NFT platform similar to OpenSea’s. Since then, investors haven’t heard much news around the platform aside from the fact that the company has millions of people on the waiting list. With OpenSea’s latest issues, we expect there to be questions and answers around the NFT endeavor.

We would also like to hear from the company about their Coinbase Cloud offering which is supposed to be a sort of AWS for crypto.

Venture Fund Markups

Although Coinbase has been vocal about the “record year” for its venture capital portfolio, we haven’t gotten a ton of insight into just how “record” setting it was. By the looks of the company’s portfolio and the stages at when they made a lot of their investments, we have to assume the markups (on-paper gains) for the companies have to be sizable.

If that wasn’t enough, Block (SQ), previously Square, also reports earnings tomorrow after market close.