Coinbase Global, Inc. Class A Common Stock Citi’s 2026 Global TMT Conference
Review the key takeaways and the transcript of this earnings call.
- Coinbase has expanded its total addressable market (TAM) significantly over the past 12 to 18 months, growing from a single product spot crypto trading platform to four trading verticals: spot crypto, derivatives (including crypto and commodities), tokenized equities for non-US customers, and prediction markets.
- Coinbase is running 12 different product lines each generating north of $100 million annually, supported by common infrastructure such as crypto custody, liquidity, financing, risk models, compliance, and onboarding.
- Prediction markets, launched six months ago, have shown tremendous early product market fit with over $100 million annualized volume and 106% quarter-over-quarter growth in Q2.
- Coinbase One membership surpassed one million paying members in Q2, growing even during a down crypto market, currently offering benefits for crypto spot trading with plans to expand benefits to other products.
- Coinbase launched one-for-one backed tokenized equities on Base for non-US customers recently, with US customer launch pending regulatory approval.
- Agentic AI payments on Base have processed over $100 million in transactions, capturing over 90% of on-chain agentic stablecoin volume, though transaction volume is not yet material enough to be a distinct financial line item.
- In Q2, Coinbase demonstrated strong expense discipline, reducing costs by roughly $500 million compared to 4Q run rate, while maintaining productivity gains driven by AI.
- Coinbase reported nine consecutive quarters of native inflows, indicating strong user trust, brand strength, and growing market share despite overall market headwinds.
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Transcript
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Okay, fantastic. Thank you everyone for joining. My name is Peter Christiansen. I cover digital assets for Citi Research. As always, I am pleased to welcome Alesia Haas, who has been a regular at our conference. Thank you so much for attending. Before I start, Coinbase has asked me to read this disclaimer. During today's discussion, Coinbase may make forward-looking statements. Actual results may vary materially from today's statements. Information concerning risks, uncertainties and other factors that should cause these results to differ is included in Coinbase's SEC filings. The discussion today will also include references to certain non-GAAP financial measures. Reconciliations to the most directly comparable GAAP financial measures are provided in the shareholder letter on the company's investor relations website. Non-GAAP financial measures should be considered in addition to, but not as a substitute for, GAAP measures. I probably should have that memorized by now.
You and me both. All right.
Let's get into it. I always love the perspective question upfront. A year ago, I posited to you asking whether Coinbase was a general store or a specialist, and it seems in the last year, we have settled that question pretty decisively with the everything exchange. Spot, derivatives, prediction markets, tokenized equities, payments, Agentic infrastructure. For someone who has checked out of the story 18 months ago, what is the one thing that would generally surprise them today?
If you have been in a coma, I guess, for the last 12 to 18 months, our TAM has expanded meaningfully. What has gone from being, as you have mentioned, a single-product spot crypto trading platform, has meaningfully expanded out to four trading verticals. Spot, crypto, derivatives, and I would note derivatives have three flavors of derivatives and also various underlying contracts. There are not only crypto derivatives, but we also now offer derivatives on commodities, metals, et cetera. Expand that out to traditional equities, but then just a few weeks ago, we then started offering tokenized equities to non-U.S. customers. Our last pillar is prediction markets, which for a six-month-old product now, has shown tremendous early product market fit, and we are seeing a really nice growth trajectory. So, great benefits to our customers to be able to trade more and more assets on one platform.
Because where their assets reside, they are more likely to trade. As I mentioned, that has just continued to multiply the TAM that we are going after as a business, which should then lead to diversification of revenue and more opportunities for growth.
Yeah. Now you are, by my count, you are running 12 different product lines, north of $100 million annually. That is a remarkable amount of simultaneous scaling.
That is my count, too, just for the record.
Oh, okay. Fantastic. How do you and the team think about sequencing and resourcing so each one of these gets the attention it deserves?
Absolutely. Well, if you look underneath the hood of those 12 products, we have common infrastructure that support the products. We started as a safe place to buy and securely store crypto. We are the world's largest crypto custodian, and crypto needs to be defined as any on-chain asset. We store roughly 12%. We layer on top of that foundation deep liquidity in our exchange, and then we have value-added services, for example, financing or our risk models, compliance, onboarding. Adding incremental products are leveraging a foundation that we've spent years building and honing, and that enables us to really bring small pods of people together to add incremental features. We also have an approach with. We've all seen productivity gains with AI. We've shared in our public filings that our pull requests are up meaningfully year-over-year.
Quality is up as a result as well, and we're able to put small teams of people against these. As we see product market fit, as we start to cross milestones, we can add incremental resourcing against that and continue to drive positive unit economics and growth.
I'm going to sneak one in. I asked this last year. Any chance that Coinbase's financial reporting will change in 2027?
I love the question. There is definitely a change potential, and it's because we've always committed that as our revenue diversifies, we will look to then update financial disclosures accordingly. in Q2, if you look on our earnings presentation, we started to break out our trading volume. Historically, we just had one aggregate trading volume number. We're now disclosing trading volume for spot versus derivatives, and then breaking out stablecoins and other, because we believe that these monetize. You all know these monetize in different ways, and so this incremental transparency should help investors better understand revenue forecasts as well. Yes, we've taken steps, and we will continue to evaluate how to make our financials more transparent and legible.
No for our investors and our analysts.
I appreciate that. Continue evolving our model. If you think about it, so many of these brand-new products that are scaling so rapidly, tons of positive indications on product market fit. Is there one product that you are most excited about, in particular, doubling down over the next year or so, even relative to everything else that has been scaling so rapidly?
We do not pick favorite children in general.
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