The British subsidiary of cryptocurrency exchange Coinbase – Coinbase UK – released its financial results for 2017 this Wednesday. As it was the company’s first full year in business, it’s impossible to make a proper comparison to past results.
Nonetheless, we can still see that the company did well last year. In its first full year of business, Coinbase UK raked in €127.89 million (€147 million) in total revenue – not bad at all.
Aside from revenue, the subsidiary had sales costs of €118.93 million ($136.70 million). Combined with administrative costs of €3.72 million ($4.28 million), that left the firm with an operating profit of €5.24 million ($6.02 million).
Additional interest expenses cost the firm €1.76 million ($2.02 million). That left the exchange with a pre-tax profit of €3.48 million ($4.00 million).
Taxation on the firm’s earnings were equal to €886,636 ($1.02 million), leaving Coinbase’s UK subsidiary with just under €2.60 million ($2.99 million) in profit for the year.
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Coinbase – a beneficiary of the boom
Whether the firm will be able to repeat this performance in 2018 is uncertain. It would be interesting to see how evenly spread revenue income was throughout the year.
The reason for this is that reports from January of this year indicate that Coinbase – which made over a billion dollars in revenue last year – made 43 percent of its revenue for 2017 in December alone.
If the same was true for Coinbase UK, and there isn’t much reason to think it wouldn’t be, then the amount the subsidiary made last year may be slightly misleading. After all, a boom that lasts one or two months isn’t going to happen every year.
Moreover, trading on Coinbase had declined by 83 percent in August when compared to January of this year. Unless the remaining 17 percent of traders were, in true Pareto Principle fashion, making up 80 percent of the exchange’s income, that’s an astonishing decline.
As such, it seems unlikely – unless there is another cryptocurrency frenzy – that Coinbase, along with other exchanges, will be raking in as much cash in 2018 as they did in 2017.