Coinbase has now overtaken two of the world's largest securities exchanges in terms of transaction revenue, according to a crypto analyst from the private bank Coutts.
In the past year, the cryptocurrency exchange generated transaction revenue of $5.75 billion, as compared with just $4.54 for Nasdaq where the shares of many world-famous companies are traded, including Apple and Microsoft.
Coinbase also surpassed the Stock Exchange of Hong Kong, the HKEX, which generated $2.67 billion over the past year, as well as Brazil's Bolsa Balcão, which generated $1.81 billion.
Keep in mind that these numbers are not directly comparable and depend on the fees exchanges charge per transaction—for example, when buying or selling stocks or Bitcoin—not just the sheer number of transactions or the platform's popularity.
Coutts’ data indicates that all the major stock exchanges, crypto exchanges, and commodities markets worldwide have generated approximately $51.27 billion of transaction revenue.
Coinbase’s Revenues: A Contextualized View
Although Coinbase has a very rapid growth in transaction revenues, the exchange is still far behind other major global exchanges.
London Stock Exchange (LSE), which operates the New York Stock Exchange and numerous futures, debt, and commodities exchanges, also remains far ahead with $9.16 billion in transaction revenue. Intercontinental Exchange Inc. (ICE), the company that operates New York Stock Exchange as well as many futures and commodity exchanges including debts and derivatives markets, has also been far ahead of its competitors with $9.16billion in transaction revenue.
Mouloukou Sanoh is the CEO of MANSA Finance. The company builds its BASE blockchain on Coinbase.
“Coinbase is still significantly lower in terms of volume than all the exchanges listed in Coutts’ data. But because they charge higher fees, that's where they have higher transaction revenue,” He said.
Sanoh Added: “I believe that there's still a very, very long way to go.”
Still, he believes that Coinbase’s revenue will surpass the traditional exchanges and possibly reach third place in terms of total revenue by 2025.
It may take between 10 and twenty years for Coinbase to surpass the Nasdaq’s overall trading volume.
“I feel like over the next 10 to 20 years is when we will see crypto exchanges completely flip traditional markets, but it's still going to take a long time,” He said. “But I would not be surprised if, at some point after the turn of the decade, Coinbase is the largest global exchange, both by volume and by trading revenue.”
Coinbase has a way to go before it can overtake Nasdaq in terms of volume. According to Coingecko it only had a trading volume of $8 billion over the last 24 hours, compared with almost $445 for Nasdaq.
Sanoh thinks this could be due to Coinbase’s growth potential in Latin America and Africa as well as in Europe.
“I think their distribution in the U.S. is very strong, but internationally they've been quite weak and hesitant to expand,” He said. “But now with the new administration, they’ll be more bullish on overseas expansion. I think that's where the next billions of dollars in revenue and volume will come from.”
Coinbase sales dropped to $1.2 Billion in Q3 of 2024, from $1.45 Billion in the prior quarter. This was below analyst expectations. The company reported $75 million profits compared with $2 million the year before.
Coinbase didn’t immediately reply to an email from Decrypt.
Stacy Elliott edited this article.