Coinbase Global, Inc. reported stronger-than-expected financial results for its third quarter, demonstrating robust growth driven by renewed momentum in the cryptocurrency market. The San Francisco-based exchange announced a substantial revenue of $1.9 billion, marking a significant 26% increase compared to the previous quarter. This performance comfortably surpassed Wall Street’s expectations, which had projected revenues around $1.8 billion.

The company also posted an impressive net profit of $433 million, translating to $1.50 per share, well above the anticipated $1.10 per share. While this represented a sequential decline from its record $1.4 billion profit in Q2, Coinbase attributed the reduction primarily to non-cash mark-to-market adjustments related to its strategic holdings in Circle and its broader crypto portfolio. Following these positive results, shares of Coinbase Global (COIN) experienced a jump of more than 4% in after-hours trading, reaching $341. The stock has shown a resilient year-to-date performance, climbing approximately 33% despite peaking above $440 in July.

A notable highlight from the quarter was Coinbase's direct investment in Bitcoin. The company announced it purchased $299 million worth of Bitcoin in Q3. CEO Brian Armstrong publicly reaffirmed his bullish outlook on Bitcoin, stating via an X post, "Coinbase is long Bitcoin. Our holding increased by 2,772 BTC in Q3. And we keep buying more." This strategic acquisition underscores the company's confidence in the leading cryptocurrency.

Coinbase's trading activity surged in Q3, a direct consequence of Bitcoin reaching fresh all-time highs during the period. This market rally reinvigorated both retail and institutional participation, contrasting with a quieter Q2 characterized by broader macro headwinds. The exchange reported $1.0 billion in transaction revenue, a substantial 37% increase from the prior quarter and an impressive 83% year-over-year rise, generated from total trading volumes of $295 billion.

Institutional volume saw a 22% sequential increase, reaching $236 billion. This growth was partly bolstered by the August acquisition of Deribit, recognized as the world’s largest crypto options exchange, which contributed $52 million in revenue during Q3. This move highlights Coinbase's strategic expansion into derivatives, including the introduction of 24/7 perpetual futures trading in the U.S. Retail activity also experienced a significant rebound, with consumer trading volume climbing 37% to $59 billion. Coinbase noted that new listings and decentralized exchange (DEX) integrations played a crucial role in boosting engagement among “advanced traders,” and its platform now facilitates trading for approximately 90% of all crypto assets by market capitalization.

Beyond trading fees, Coinbase continued to successfully diversify its revenue streams, with subscriptions and services revenue increasing by 14% to $747 million. A significant contributor was stablecoin revenue, largely derived from its pivotal role in distributing and managing Circle’s USDC, which rose to $355 million—a 43% increase year-over-year. Average USDC balances held within Coinbase products reached an unprecedented $15 billion, supported by the stablecoin’s rising market capitalization and innovative new institutional reward programs. Blockchain rewards, including income from staking, also demonstrated strong growth, increasing 28% quarter-over-quarter to $185 million, primarily aided by surging prices for Ethereum and Solana. Furthermore, both custodial fees and interest income hit new highs, contributing to the platform’s total assets reaching $516 billion.

Looking ahead, Coinbase reiterated its commitment to developing its vision of an “Everything Exchange,” an integrated platform designed to unify spot, derivatives, and onchain services. The company also emphasized the ongoing progress of Base, its Ethereum layer-2 network, which has emerged as the leading L2 solution for stablecoin adoption, boasting $4.6 billion in dollar-pegged assets. CEO Brian Armstrong underscored the company's strategic focus on scaling payments through the advancement of stablecoin adoption, laying the groundwork for the future financial system.