10-30-2026 
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TL;DR: The Coinbase (NASDAQ: COIN) digital asset exchange posted its first quarterly profit in a year, thanks to some favorable accounting and its new prediction market fans making up for the ever-thinning ranks of crypto traders. Meanwhile, stablecoin revenue continues to grow as Coinbase expands its product lineup and looks beyond traditional crypto trading for growth.
Key Takeaways:
- First profit in four quarters despite ongoing declines in crypto trading activity and user numbers
- USDC sets more records as RLUSD looks to crash this party
- Prediction market, derivatives now 25% of transaction revenue, helping offset weaker spot trading
- Outlook for Q4: meh, with transaction revenue off to a relatively sluggish start
- Oh look, another data breach, this time involving a third-party analytics vendor and customer informations
Coinbase reported revenue of just over $1.2 billion in the three months ending September 30, a roughly one-third decline from the same period last year but basically flat from Q2 2026’s total. Despite this statistic, net income hit a whopping $718.7 million, a sharp reversal from Q2’s $360 million loss, marking an end to three straight quarters of net losses.
However, the figures were goosed by $715 million in gains on Coinbase’s tokens held for investment. Stripping out all the asterisks, Q3’s operating income was a far more modest but nonetheless positive $61.7 million.
Transaction revenue totaled $590 million, barely half the sum generated a year ago when token prices were hitting all-time highs, but only $9 million below Q2’s total. Consumer transaction revenue was also basically flat at $450 million, while institutional revenue slipped by ~$8 million to $91.6 million. ‘Other’ transaction revenue was also flat at $48.5 million.
Bear in mind that ‘transactions’ now include a far wider variety of elements beyond spot crypto trades, reflecting Coinbase’s decision to put greater emphasis on derivatives, prediction markets, and other products that don’t appear to be dying on this vine.
Coinbase no longer offers specifics on who’s trading which tokens, but total crypto trading volume was just $134.5 billion in Q3, the fourth straight quarter of falling figures and less than half the $294.3 billion reported in the same quarter last year. Consumer volume was just $23.4 billion, down 60% year-on-year, while institutional volume was down 53% to $111 billion.
That disinterest is reflected in Q3’s monthly transacting user (MTU) stats of 7.4 million, nearly 2 million fewer than in the same period last year. For the record, Coinbase defines ‘transacting’ extremely broadly, lumping in passive activities like customers receiving a payment from holding stablecoins on the platform or staking rewards.
Crypto derivatives trading volume was down 7% from Q2 to $986 billion, although that’s up 16.5% year-on-year. The only sequential volume improvement came from stablecoin trading, which nearly doubled to $14.4 billion.
S&S inches up as Ripple’s RLUSD crashes USDC party
Coinbase’s subscription & services segment brought in $570 million, $15 million higher than Q2, representing 49% of total revenue (one point better than Q2 and another new high). Blockchain rewards, aka customers giving Coinbase their tokens to stake as validators on proof-of-stake networks, contributed nearly $86 million to this total, up $2.5 million sequentially.
But the segment’s largest contributor remains stablecoin revenue, based largely on Coinbase’s lucrative partnership with USDC-issuer Circle (NASDAQ: CRCL). Stablecoin revenue hit nearly $307 million, up $15 million from Q2.
The average amount of USDC held in various Coinbase products during the quarter hit a record $22 billion, $2 billion higher than Q2. Coinbase noted that this sum represented ~30% of USDC’s total market cap, and the exchange claims to have “captured ~50% of all USDC economics.”
That latter stat got a boost from the deal Coinbase reached this spring to become “the official treasury deployer” of USDC on the Hyperliquid decentralized exchange. The deal took effect in June, making Q3 the first full quarter in which Coinbase reaped the benefits.
On the analyst call, Coinbase execs reiterated earlier pledges to be ‘asset agnostic’ when it comes to stablecoins, noting that the platform also supports the PYUSD token issued by payments giant PayPal (NASDAQ: PYPL). That agnostic roster grew a little larger this week as Coinbase announced a deal to bring Ripple Labs’ RLUSD stablecoin to its platform.
Retail and institutional clients can now trade and manage RLUSD via the Coinbase exchange, retail app, and the Coinbase Prime brokerage. International customers will soon be able to deploy RLUSD as collateral on the new Coinbase Global Exchange, the company’s expanded derivatives platform (more on this below).
This is really turning out to be RLUSD’s week, as Tuesday saw Ripple strike a similar deal to expand the use of RLUSD on the Robinhood (NASDAQ: HOOD) trading platform and its affiliated Bitstamp exchange.
Prediction market growth masking crypto’s decline
Coinbase continues to reap the benefits of its 2025 acquisition of the Deribit derivatives platform, although the pace of those benefits appears to be slowing. While the early post-acquisition quarters saw derivatives trading volume double and then nearly triple, Q3’s $4.34 billion figure was only $120 million higher than Q2. That said, Q2’s volume was slightly below Q1’s, so any return to positive growth is welcome.
Coinbase doesn’t break out its derivatives revenue, and it’s only slightly more forthcoming regarding its nascent prediction market offering. Prediction market ‘annualized revenue’ has now topped $200 million, double what Coinbase claimed in Q2, and Coinbase CFO Alesia Haas said Thursday that, taken together, prediction markets and derivatives “were about 25% of our total transaction revenue” in Q3.
Coinbase said its prediction product’s number of daily traders rose 60% quarter-on-quarter, and the offering has recorded “82% quarterly compound growth since launch,” making it “one of the fastest-growing products by revenue in Coinbase’s history.”
Haas celebrated the fact that prediction markets are “less correlated to crypto volatility,” although this somewhat undercuts the claim in Coinbase’s presentation that recurring contracts, “e.g., crypto volatility,” are “driving durable engagement between major [sports] events.”
Speaking of non-sports events, Coinbase recently launched a ‘midterms dashboard’ to help prediction market users track odds on all the U.S. elections taking place next Tuesday (Nov. 2). Coinbase CEO Brian Armstrong called it “arguably the best place to track what’s happening in the midterm elections,” you know, besides actual news sites.
Haas pushed back on the belief that prediction markets were cannibalizing crypto trades, saying “when we look at our trading profile, people are still continuing to trade spot, just maybe at a lesser level than they did in past quarters.” Or, as Spinal Tap manager Ian Faith would say, crypto spot trading’s appeal is becoming more selective.
Outlook
Looking at the current quarter, the company said overall transaction revenue stood at $165 million through October 25, a little behind Q3’s average, as token prices have been locked in a narrow range for months (but took a sharp tumble Thursday as reports spread that the Binance exchange had suffered a hack measured in the billions). Coinbase is projecting subscription & services revenue to come in between $550-$630 million, “up about 3% at the midpoint.”
Earlier this month, Coinbase announced that it had completed its integration of Deribit, connecting U.S. and international derivatives markets into a single liquidity pool via the aforementioned Coinbase Global Exchange.
For the moment, the platform is still only accessible by international and institutional customers, but U.S. retail access is promised for later this year via its U.S.-registered futures commission merchant, Coinbase Financial Markets.
Coinbase is also reviving its shuttered Coinbase Pro brand for advanced traders, promising a “rebuilt from the ground up” experience for high-volume active traders. The new & improved platform is expected to launch “at the end of this year.”
Investors were largely nonplussed by Coinbase’s performance, as the shares closed Thursday down 1% to $160.59 but slid another 5.5% in after-hours trading as analysts digested the report and mulled the negative impact of the Binance hack.
Once more unto the breach
A few days before the Binance news, an X account attributed to ‘DelCrxpto’ tweeted that Coinbase had suffered a “data breach” in which “hackers accessed contact info for +70,000 users.” The tweet said there was “no confirmation on if passwords or funds were stolen.”
Replies to the tweet suggested that some Coinbase users were receiving “scam calls and emails” from individuals purporting to be Coinbase staff, while others claimed attempts were being made to access their exchange accounts.
About three hours after this initial tweet, Coinbase tweeted that it “has not had a data breach.” Coinbase said Amplitude, an analytics vendor, “experienced a security incident which impacted a small subset of Coinbase customer contact data.”
Coinbase claimed to have “found no evidence of unauthorized access to Coinbase systems, and customer funds were not impacted. We are notifying impacted customers and regulatory agencies in accordance with our legal obligations.”
The following day, Coinbase copped to “limited transaction data” being among the compromised information but claimed it didn’t include any info that would allow access to accounts or funds. But the company has yet to offer specifics on how many users were impacted, saying only that it continues to notify these individuals directly.
Responses were swift and scathing, with users calling out Coinbase for its semantic distancing of itself from its vendor, when the bottom line is that Coinbase customer data is now in the hands of bad actors.
Others were quick to recall the May 2025 data breach in which a different vendor sold Coinbase customer data to bad actors. Coinbase waited months before informing the Securities and Exchange Commission (SEC) of the breach, despite 70,000 of its customers being impacted and Coinbase itself estimating the potential damage at up to $400 million.
Others noted the crisis comms similarities between Coinbase and CoinDCX, the India-based exchange in which Coinbase has an ownership stake. Earlier this month, CoinDCX initially denied that it had suffered a compromise, only to eventually cop to losing $16 million after blockchain sleuths presented irrefutable evidence indicating something was very, very wrong.
FAQs:
How did Coinbase’s Q3 revenue and profit compare with earlier periods?
Revenue was just over $1.2 billion, down about a third from a year ago and flat versus Q2. Net income was $718.7 million, reversing Q2’s $360 million loss, but $715 million of that came from gains on tokens held for investment. Operating income was a more modest $61.7 million.
What is driving Coinbase’s growth while crypto trading declines?
Prediction markets and derivatives. Prediction market annualized revenue topped $200 million, double the Q2 figure, and together with derivatives accounted for about 25% of transaction revenue. Meanwhile, total crypto trading volume fell for the fourth straight quarter to $134.5 billion.
How important is stablecoin revenue to Coinbase?
Very. The subscription and services segment brought in $570 million (49% of total revenue), and stablecoin revenue was its largest contributor at nearly $307 million. Coinbase held an average of $22 billion in USDC during the quarter and claims to have captured about 50% of all USDC economics.
What is Coinbase planning next?
It has finished integrating Deribit into the Coinbase Global Exchange, with U.S. retail access promised later this year. It also plans to relaunch the Coinbase Pro brand for high-volume traders at the end of the year. It added Ripple’s RLUSD stablecoin this week and projects subscription and services revenue of $550–$630 million for Q4.
What was the data security issue, and how did Coinbase respond?
Coinbase said it had no data breach but that its analytics vendor, Amplitude, suffered a security incident affecting a small subset of customer contact data. It later admitted limited transaction data was also exposed, though not information that would allow access to accounts or funds. Critics said Coinbase was distancing itself from its vendor, and it has not said how many users were affected.
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