Coinbase, Marathon Digital Profits Take a Hit, MicroStrategy Expands Bitcoin Portfolio in Q2

• Coinbase, Marathon Digital, and MicroStrategy revenues are all down for Q2 2024.
• Compounding market dynamics such as the Bitcoin Halving and Bitcoin and Ethereum ETFs are impacting results.
• MicroStrategy has acquired 12,222 BTC since the start of Q2 2024. Total holdings now stand at 226,500 BTC.

Major crypto firms, including Coinbase, Marathon Digital, and MicroStrategy, have released their Q2 2024 earnings reports, which are a very mixed bag of results this time around.

Although overall revenues have hit a wall for these companies, they have all experienced relatively solid performance in other operational metrics.

Coinbase Revenue’s Down

Coinbase’s Q2 2024 shareholder letter  revealed a net revenue of $1.38 billion, down from $1.58 billion in Q1. However, the company’s earnings for the first half of 2024 have already exceeded its total revenue for 2023.

The crypto exchange’s consumer transaction revenue came in at $781 million, down 27% from Q1. Reflecting this, Coinbase trading volumes also took a 28% hit. However, the firm notes that the number of transactions on its layer-2 network, Base, was up 300% quarter-over-quarter.

In more positive news, subscription and services revenue grew by $599 million, up 17%, and was largely attributed to “higher average USDC on platform balances and USDC market capitalization.”

It also notes that higher average crypto prices provided a nice boost, highlighting Solana (SOL) and Ethereum (ETH). Looking to 2025, Coinbase anticipates its Q3 subscriptions and services revenue to net somewhere between $530 and $600 million.

Although some of these figures fell a few points short of analysts’ estimates , the Coinbase stock, COIN , relished modest gains of around 5% late Thursday following these results. COIN is up 135% for the past year at the time of writing.

Marathon Digital Q2 2024

American crypto mining firm Marathon Digital has reported a significant net loss despite a 78% increase in quarterly revenues  totaling $145.1 million.

As per the firm’s Q2 2024 report, it accrued a net loss of $199.7 million, or $0.72 per share. This is a big leap from its Q2 2023 losses  of $21.3 million, though the company did have to make some difficult decisions lately, which may explain its underperformance.

Marathon had to offload BTC. In Q2 2024, Marathon produced 2,085 Bitcoin (BTC), a 30% increase from Q2 2023. But, as it notes, it had to sell 51% of the BTC it mined during Q2 to cover operating costs. This makes sense, given that Bitcoin Halving reduced the block reward in half, forcing mining operations to expand or exit the market altogether.

That said, the firm purchased $100 million worth  of BTC on July 25 on the open market, increasing its balance to more than 20,000 BTC. Marathon’s disclosure doesn’t specify the acquisition cost; however, the data from Bitcoin Treasuries  shows that it has purchased back more BTC than it sold.

MicroStrategy Q2 2024

MicroStrategy also reported  a net loss of $102.6 against an income of $22.2 million. Despite the profit hit, the firm simultaneously announced an absurd purchase of 12,222 Bitcoins for a whopping $805 million, raising the firm’s balance to 226,500 BTC, or $14.7 billion.

The firm notes that it will incur $45 million or so in interest expenses, a further $20 million in cash taxes, and will net roughly $82 million prior to taxes. Interestingly, MicroStrategy disclosed that it raised $2 billion after issuing convertible notes this year. It reports that proceeds were used to pay interest expenses and taxes.

Another reason revenues would be down is that the firm’s primary motive is to acquire BTC, which doesn’t generate any revenue and raises questions about cash flows.

It’s worth stating that the price of BTC has nearly doubled this year, meaning that so has the value of MicroStrategy’s stash. At press time, MicroStrategy’s Bitcoin holdings  were worth almost $14.7 billion.

Tether Thrives While Others Struggle

Stablecoin issuer Tether also released its revenue numbers this week. Despite marking its departure from the European Union following Markets in Crypto-Assets Regulation (MiCA) regulations, the firm had a record-breaking $5.2 billion in the first half of 2024.

In Q2 2024, unlike most crypto firms, Tether’s profits reached $1.3 billion, another best-ever for the USDT issuer.

Tether’s CEO, Parolo Ardoino, celebrated the firm’s growth and described Tether as “a once-in-one-hundred-year-opportunity” in a lengthy post to X.

Although it’s worth noting that while MicroStrategy and Marathon Digital bought more Bitcoin, Tether, on the other hand, slowed down its BTC accumulation. As of June 30, Tether’s report showed that its Bitcoin balance stood at $4.73 billion, 12% lower than its Q1 2024 report. It is uncertain why Tether has decided to break from its trend of regular Bitcoin purchases.

About the Author

Eddie Mitchell

Eddie has been writing news and content primarily for crypto news and industry players over the past seven years. With an eye for the bigger picture, Eddie prefers to investigate the broader implications of a story, as well as explore the weird and wonderful world of crypto. He believes blockchain has already changed the world, but observes the space overall with a skeptical and adoring eye.

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