In a recent analysis, Jamie Coutts, a renowned crypto analyst, highlighted that Coinbase has surpassed two of the world’s largest securities exchanges in transaction revenue. This achievement marks a significant milestone for the cryptocurrency exchange.
Coinbase Surpasses Major Exchanges in Revenues
According to Coutts, Coinbase generated an impressive $5.75 billion in revenue over the past 12 months. In comparison, NASDAQ, home to corporate giants like Apple, Google, and Microsoft, registered $4.54 billion, while the Hong Kong Stock Exchange (HKEX) recorded $2.67 billion. Additionally, Coinbase outpaced Brazil’s Bolsa Balcão, which amassed $1.81 billion.
It is important to note that these figures are not directly comparable due to varying transaction fees across platforms, whether purchasing stocks or cryptocurrencies like Bitcoin. Aggregated data from Coutts reveals that global exchanges, encompassing crypto, stock, and commodity sectors, generated approximately $51.27 billion in transaction revenue. The London Stock Exchange (LSE) led this list with $10.82 billion, while the Intercontinental Exchange (ICE), operator of the New York Stock Exchange (NYSE) and numerous futures, debt, and commodities exchanges, followed with $9.16 billion.
Still Behind in Volume
Despite its revenue achievements, Coinbase lags in transaction volume compared to major players like NASDAQ. Mouloukou Sanoh, CEO of MANSA Finance, a global DeFi platform, noted, “Coinbase remains significantly lower in volume than the exchanges listed in Coutts’ data. Higher fees contribute to its increased revenue.”
Sanoh predicts that Coinbase will continue to outperform traditional exchanges in revenue and could potentially secure the third spot in total transaction revenue by 2025. However, he estimates it may take 10 to 20 years for Coinbase to surpass NASDAQ in total trading volume.
A Long Way to Go
Sanoh elaborated, “Over the next 10 to 20 years, we might witness crypto exchanges overtaking traditional markets, but it will require time.” He anticipates that by the next decade, Coinbase might emerge as the largest global exchange, both in volume and trading revenue.
Sanoh attributes this potential growth to Coinbase’s expansion prospects in Latin America, Africa, Europe, and other regions outside its U.S. stronghold. Although Coinbase boasts a robust presence in the U.S., its international expansion has been limited. He believes that with the current administration, Coinbase will adopt a more aggressive overseas strategy, potentially fueling substantial revenue and volume growth.
To surpass NASDAQ in trading volume, Coinbase still has a considerable journey ahead. Currently, Coinbase recorded over $10 billion in trading volume in the past 24 hours, whereas NASDAQ reported nearly $445 billion.
Crypto Sector Poised for Significant Re-rating
Jamie Coutts emphasized that the cryptocurrency sector is rapidly outpacing traditional finance (TradFi) in several critical areas. He noted that Centralized Exchanges (CEX) and Decentralized Exchanges (DEXs) are expanding 2.5 to 4 times faster than TradFi, with DEXs ranking among the world’s most profitable applications.
Evaluating the CEX sector akin to Coinbase, Coutts envisions a potential market cap of $749 billion, surpassing TradFi’s $610 billion. By 2025, he anticipates TradFi will catch up through CEX acquisitions and increased crypto integrations. CEXs might list on TradFi exchanges and launch their own DEX platforms. The tokenization of real-world assets (RWA) is expected to enhance sector valuations, with DeFi poised to grow 4 to 5 times, outpacing major cryptocurrencies. Despite regulatory hurdles, Coutts believes that the crypto sector is on the brink of a significant re-rating.
