COIN Trans: Shift from Bitcoin to Subscriptions

Dolphin Research Trans of $Coinbase(COIN.US) FY26Q2 earnings call

I. Key takeaways

1) Circle partnership renewed under original terms: Coinbase has met the renewal conditions, and the agreement will roll over as is, removing prior uncertainty around terms. The company will continue to work with Circle to scale USDC and build out the ecosystem.

2) Revenue mix significantly more diversified: BTC-related trading revenue has fallen from historically over half of total to 12% now. Diversification is happening across trading fees (prediction markets, perpetuals, stock trading) and non-trading fees (Subscriptions & Services), with the latter compounding over recent years and improving overall predictability.

3) Subscriptions hit record despite weak market: Coinbase One paid subscribers reached a new high (already above 1 mn), even as crypto volumes fell, underscoring the product’s countercyclical nature. Mgmt views Coinbase One as accretive rather than take-rate compression: subscribers trade more with better unit economics, and also contribute to staking, credit card and other lines, with higher retention and activity. If large-scale migration from à la carte fees to subscriptions occurs, reported revenue will shift within the P&L.

4) Growth marketing ROI: Typical payback is ~1 year, and recent performance is better than that benchmark. Spend is focused on prediction markets, crypto spot, and newly launched derivatives, with early data showing incremental spot volumes from new-product users and no cannibalization.

II. Call details

2.1 Q&A

Q: If the CLARITY Act fails to pass the Senate, what would it mean for Coinbase and for consumers? Will the company act more cautiously in the gray area between the CFTC and SEC?

A: I’m optimistic about getting a full Senate vote. There are intense end-stage negotiations underway, which to me signals real effort to get this over the finish line, with staff and Senators having spent thousands of hours to produce a solid outcome. Deadlines around the Aug recess act as a forcing function that often brings parties to the table at the end; there have already been many calls this week. Of course, even after a floor vote there are more steps, so nothing is ever 100%, but overall I’m optimistic, and appreciate Stand With Crypto advocates who sent over a million emails and calls.

As for a no-pass scenario, it’s largely business as usual for Coinbase for a few reasons. Many elements required by CLARITY already align with our best-practice operations. More importantly, both the SEC and CFTC Chairs have publicly indicated that, regardless of CLARITY, they are prepared to issue clear rules; they may be waiting on CLARITY’s outcome, but if it fails they will move ahead so firms like Coinbase can operate with greater certainty. Passage is still better at the margin, as legislation can outlast administrations and support long-term investment, but the real harm from non-passage would fall on U.S. consumers, not Coinbase.

Q: Why did Coinbase join Open USD (OUSD)? Some view OUSD as a major threat to USDC. Is joining a competing stablecoin effort about gaining leverage in negotiations with Circle?

A: On Circle first: we’ve satisfied the renewal conditions, and the agreement renews under the original terms, removing any ambiguity. We will continue partnering with Circle to drive USDC growth and expand the ecosystem.

On OUSD, the short answer is we are a multi-stablecoin platform. We aim to offer the stablecoins customers want and secure good economics where possible, while maintaining our strong relationship with Circle and USDC, which is among the best economically. We already support others like PayPal’s PYUSD and Tether’s USDT, and we’re excited about the Open USD alliance as an additional business and revenue opportunity, including derivative use cases such as FX.

Q: Recent public appearances and the appointment of a Base App lead suggest a push to reconnect with crypto-native users. What’s the thinking?

A: Coinbase serves many constituencies, and the builder community on Base is even broader, so we work to connect with all of them. Our users range from the largest GSIB banks building on our infrastructure to AI Agents opening wallets on our stack, fintechs and payment providers, a large retail base, and both casual and professional traders. The crypto-native community you referenced is important, and we proactively engage them.

This community is highly internet-native, and I sometimes need to learn the lingo and norms. Fortunately, our team includes leaders who can go deeper with these groups, including a recent hire from that community to lead the Base App. I’ll also keep joining podcasts that reach different cohorts, including crypto-native audiences.

Q: Several senior departures clustered this quarter. Why the timing, and are there strategic shifts across People, Legal, or Institutional?

A: No strategic changes. One of Coinbase’s strengths is a deep bench and a robust succession process. Tenure varies and transitions are normal, but we have long-serving, high-caliber leaders ready to step in, which is a competitive advantage.

Many of the new leaders, such as those taking People and Legal responsibilities, were developed by their predecessors. We’re excited about the next generation, and these moves are individual decisions with no strategic signal to read into.

Q: Coinbase is chosen for trust, not lowest price, and over 90% of agentic stablecoin volume settles on Base. But AI Agents are price- and latency-driven with no brand loyalty. As Agents grow, can the trust moat translate, or does agentic commerce structurally push Coinbase into price competition?

A: Great question, and we think about serving both AI Agents and humans. Agents do care about price, and Base offers sub-cent costs with sub-second finality, which is highly competitive. But I also expect Agents to prefer reliable, secure, liquid, compliant, and stable infrastructure, much like choosing AWS or a given cloud for specific workloads.

So trust still matters in that world. We are rolling out the red carpet to serve Agents appropriately.

Q: Since Dec 2025 you’ve launched many new products and accelerated iteration. How do you drive cross-adoption and use these products as entry points to onboard new users? How do you allocate marketing spend?

A: Our strategy starts with safe custody to anchor assets on-platform, because when customers custody with us, they tend to trade with us. In growth marketing, we lean into products meeting demand and where retail engagement originates. We’re seeing strong ROI in prediction markets, crypto trading, and some newly launched derivatives, with typical payback around a year and recent performance better than that.

Early signals show customers using these new products, like prediction markets, also bring incremental spot volume. We’ve seen no self-cannibalization; cross-sell is lifting overall activity and driving incremental trading as users adopt more products.

Asset anchoring is core to this strategy. As the most trusted brand in crypto, we custody more crypto than anyone; when customers store assets with us, each return visit for a given product is a chance to showcase others. Over time they adopt more, retention improves with more products used and more assets held, and we use incentives to reinforce this, such as better Coinbase One pricing tiers as asset levels rise.

Q: BTC-related trading revenue dropped from over half of total to 12%. What other revenue pillars are you prioritizing, and any progress in agentic commerce?

A: We are diversifying across trading fees and non-trading Subscriptions & Services. On trading, prediction markets and perpetuals are gaining traction, our overall volume share is rising, and we launched stock trading; stock options and other products are on the roadmap, so fee mix within trading should continue to broaden. I also believe BTC will come back strongly as it cycles.

In any given moment, some things rally while others fade, which is why we pursue an ‘everything exchange’ strategy: stock the shelf so when a category heats up, we have inventory. On non-trading, Subscriptions & Services have been growing steadily for years, enhancing visibility.

One overlooked point: Coinbase One paid subs hit a record this quarter. Despite a clear down market with softer crypto volumes, membership grew, underscoring subscription value and stickier behavior; these users try the most products and services. Subscriptions are a key growth lever to drive member scale and engagement over time.

On agentic finance, it’s very early. Coinbase has an early lead: most agentic activity we see is happening in USDC, on Base, and via X402, with Coinbase Developer Platform a strong resource for builders. But it’s still early overall, so we don’t have specific numbers or forecasts to share.

Q: You launched Pre-IPO perpetuals for non-U.S. users last month, starting with SpaceX. What’s next, when will there be more private names, and is there a U.S. timeline?

A: Early traction is encouraging, with strong demand. U.S. access is on the roadmap, and we’ll keep pushing from a regulatory standpoint. Expanding access to previously unreachable assets is an important part of democratizing finance, and we’ll work through the U.S. approval process.

Q: How do you view the evolving competitive landscape, especially Robinhood expanding crypto and launching its own L2? How does that relate to the Base ecosystem?

A: It’s normal to see many firms launch their own chains in a growing market; fragmentation often precedes consolidation, as seen in autos and railroads historically. In stablecoins, we saw a similar pattern: many launches, yet USDC and Tether have held share over the past year with only minimal dilution, highlighting real network effects.

For users, cross-platform transferability is critical, and staying in the same stablecoin avoids FX or conversion fees. I suspect blockchains will follow a similar path: some specialized chains from firms like Stripe or Robinhood, while Ethereum and Solana remain general purpose. The interesting question is when consolidation begins.

Base, as the largest L2 on Ethereum, continues to perform well. It is among the most liquid venues for BTC/ETH spot and likely ranks No.1 in stablecoin transfer volume, at roughly $32 tn over the past 12 months. New use cases like X402 are also leading mainly on Base.

We’re excited about Base and its innovation. We’ve publicly outlined a phased path to further decentralization so Base becomes neutral infrastructure for many builders, and we’re making good progress across those phases. We likely have a two-year head start and will keep investing in Base so everyone can build on it; more firms will likely launch chains, and the open question is when consolidation arrives and whether crypto sees M&A-like dynamics in chains.

Q: Your HyperLiquid partnership suggests that third parties holding substantial USDC can capture much of USDC’s economics. How do you scale the network and onboard participants while protecting long-term economics?

A: Anyone can become a Coinbase client, hold USDC with us, and participate in rewards. We welcome institutions, and retail users such as Coinbase One members can earn by engaging with our products and services on their USDC. We view HyperLiquid similarly, as a key market participant in perpetuals.

We believe the partnership expands network effects and USDC adoption by deeply embedding it in a major venue with significant market-making activity. Liquidity network effects are crucial for stablecoins, base protocols, and for Base itself. Deepening USDC’s role in this ecosystem should drive broader growth and adoption, and we’re comfortable sharing economics to accelerate those network effects.

We’ll keep investing to make USDC bigger. By trading volume it is already No.1, and it’s the largest regulated stablecoin globally. The only remaining gap is on market cap when regulated and less-regulated coins are combined, where it trails Tether; we intend to share economics as needed to take No.1 across all measures, because leadership delivers outsized benefits.

Q: Coinbase One has topped 1 mn subs and set a new high. Members trade more with higher ARPU, but they enjoy zero-fee trading and retail trading revenue is recognized via spread. Is revenue per $ of volume higher or lower for members, and should investors view Coinbase One as accretive or take-rate compression?

A: On average, Coinbase One members trade more with better unit economics, though edge cases exist. Not all revenue shows up in trading, since these members also stake and use Coinbase One credit cards, so revenue comes from multiple lines. Overall, it is accretive because it lifts activity across the stack.

We see better retention and engagement. If subscription adoption becomes widespread and users move from à la carte pricing to Coinbase One, you will indeed see a structural shift in revenue mix within the P&L.

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