Coinbase CEO Brian Armstrong has revealed that the exchange's trading revenue is down roughly 50% or more compared to last year, according to a Dec. 7 report from Bloomberg.
Armstrong made the statement as part of an interview with the David Rubenstein Show. When asked about the income from the exchange, he fixed that the company made $7 billion in revenue and $4 billion in profit in 2021, but "seems like, you know, about half that or less" in 2022.
Bloomberg said a Coinbase spokesperson later clarified that 2022 revenue, not profit, was projected to be less than half of what it was in 2021.
Coinbase had previously fixed in a letter to investors that it expected to record a loss of approximately $500 million in adjusted EBITDA by 2022. Adjusted EBITDA is an earnings metric that does not include interest, taxes, depreciation or amortization.
In the interview, Armstrong was asked if he thought the bankruptcy of FTX it will hurt the crypto industry. He admitted that it is "a black spot for the industry" but argued that what happened is not much different from traditional financial scandals like Bernie Madoff and Enron.
Armstrong also said he thought regulation "wouldn't be a bad thing" and that the collapse of FTX would "serve as a wake-up call" leading to clearer regulations in the US.
When asked which regulatory body should have authority over cryptocurrency exchanges, the Coinbase CEO emphasized that different cryptocurrencies have different use cases and do not all fall into a single category, so different cryptocurrencies will need to be regulated by different agencies.
2022 has been a difficult year for crypto exchanges, including Coinbase. In May, the TerraUSD (TUSD) stablecoin lost its peg to the US dollar, causing fear to spread through the market. In July, crypto lender Celsius declared bankrupt after being unable to process withdrawals partially due to the fallout from the TUSD collapse.
Related: Crypto to Be Regulated Like Securities: ICE Chief and Senator Warren
Just as the cryptocurrency market was beginning to recover, the second largest centralized cryptocurrency exchange, FTX, had a liquidity crisis and was unable to process withdrawals. He later also started bankruptcy proceedings.
As a result of these events and other factors, cryptocurrency trading activity has plummeted over the course of the year and Coinbase has reported a 44% decline in revenue in the third quarter alone.
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