Coinbase won $ 1.5 billion in Circle, Investment Gains Show

The first of these figures is $ 1.5 billion. This figure reflects what Coinbase has described as “gains before taxes on strategic investments – which included an unrealized gain on our investment in a circle”. Translation: Coinbase struck the jackpot when Circle, its partner on the stable, fast growing USDC, became public in early June and saw the value of its actions shortly after.

Coinbase is probably subject to the same six -month locking as the other shareholders of Circle, and it is not clear when the company could withdraw its windfall or if these actions still go the value when it decides to do so. But even if Circle Stock decreases, it is sure that Coinbase will always be seated on a significant and liquid investment, it can remove a slowdown or use to power its impressive series of acquisitions.

It is also important to recognize that Circle is only one of the many cryptographic companies in which Coinbase has a participation. While the cryptography market continues to mature, other startups will become public, and it is a good bet that Coinbase will be able to collect when they do. If this turns out to be the case, the $ 1.5 billion that the company has declared as a occasional article will in fact be reproduced to higher or lower diplomas in the coming quarters.

The second unique issue that Coinbase reported on Thursday is part of a much less positive story. It would be “307 million dollars in spending linked to the data flight incident disclosed in May”.

The incident in question is the calamity hacking episode which saw the criminals to bribe the customer service agents in India, then use the personal data they obtained to pretend to be Coinbase employees and fraud customers. In response, Coinbase has undertaken to do good all the customers who have lost money in the program and put a bonus of $ 20 million at the head of the officials.

If the episode fallout cost only $ 307 million, Coinbase can count this as a victory. But it is a large if in the light of the herd of lawyers of collective appeal and regulators of the state aligned to extract a payment of the company on the violation of data. Then there are the reputation damage that goes with Coinbase which do not see how the outsourcing of customers of customers sensitive to dirt agents in India has posed a security risk. For the moment, however, the company seems to have resisted the storm of public relations, and its announcement of a new “center of excellence” customer service in North Carolina could help to smooth the remaining mistrust.

Finally, there is a third unique number in Thursday’s profits report: “a gain of $ 362 million on our crypto investment portfolio (largely not achieved).” This reflects a pair of important recent developments. The first is the obvious evolution of the prices of cryptographic assets, which fattens the assets of the Coinbase Treasury. The other is the recent change in accounting rules which allows companies to record cryptography gains as they accumulate. Although companies accumulate crypto on their balance sheet are generally an unpleasant corporate financing strategy, it is fortunately a small part of Coinbase operations, and for the moment, the gains are very real and help strengthen its already solid fundamental.

Although punctual numbers are generally only that – a temporary noise that should not be confused with a broader performance signal of a business – they can also represent something more. This is the case with the benefits of Coinbase T2, where articles like its massive circle are undoubtedly more important than the usual trading income and fluctuations.