Major US crypto exchange Coinbase saw a staggering $53 billion drop in retail and institutional trading volume in the second quarter of 2023.
With a new shareholder letternotes that it has processed $14 billion in consumer trading volume and $78 billion in institutional volume, for a total of $92 billion.
The figure represents a 36.5% drop from the previous quarter, as Coinbase recorded total volume of $145 billion in Q1, with retailers contributing $21 billion and institutions contributing $124 billion.
It is also lower than the $217 billion in total trading volume Coinbase processed in Q2 2022, a drop of more than 57%.
Coinbase saw reduced trading volumes this quarter amid recent US regulatory concerns.
In June, the Securities and Exchange Commission (SEC) sued the exchange, alleging it sold unregistered securities. The regulator specifically referred to Cardano (ADA), Solana (SOL), and Polygon (MATIC) as “crypto asset securities.”
Coinbase has asked a judge to drop the lawsuit, accusing the SEC of violating due process.
Despite declining trading volumes, Coinbase says Q2 represented a “strong quarter of execution,” citing employee layoffs as a positive development for the company.
“A year ago, in the second quarter of 2022, we started reducing our cost base to work more efficiently. One year later, we are proud to say that our quarterly recurring operating expenses are down nearly 50% Y/Y (defined as technology and development, general and administrative, and sales and marketing). This includes a headcount reduction of more than 30% year over year, which while painful, has paved the way for a more efficient environment where our teams demonstrate stronger execution and deliver results. In the second quarter, we again generated positive Adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) and increased our USD Resources for the first time since the end of 2021, while continuing to expand our product suite.”
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