“Crypto is eating financial services.”

That was what Coinbase CEO Brian Armstrong told investors on Thursday’s (May 8) first quarter 2025 earnings call.

Coinbase revenue for the quarter reached $2.03 billion, down 10% from the prior quarter but ahead of consensus expectations. Adjusted EBITDA came in at $930 million, while net income fell sharply to $66 million, impacted by a $597 million pretax loss on its crypto investment portfolio, primarily unrealized.

But arguably the most transformational part of Coinbase’s Q1 wasn’t financial — it was political. After years of regulatory uncertainty in the U.S., executives expressed optimism that the tide was turning, noting that the company was among the few crypto firms invited to the first-ever White House-hosted crypto summit.

“We are excited about progress on stablecoin [regulations], there will be another vote next week,” Armstrong said. “With greater regulatory clarity, we believe crypto rails will update financial infrastructure around the world.”

Coinbase also won a courtroom victory with the dismissal, with prejudice, of the SEC’s lawsuit alleging unregistered securities offerings.

“We are excited about the … new chapter in the U.S.,” said Coinbase CFO Alesia Haas.

And on the “crypto eating financial services” front, Coinbase on Thursday (May 8) also agreed to acquire Deribit, the world’s biggest trading platform, for roughly $2.9 billion, comprising $700 million in cash and 11 million shares of Coinbase stock.

It is also at least the fourth crypto deal valued at more than $1 billion to be announced in the last month and a half. In April, Ripple said it was acquiring prime broker Hidden Road for $1.25 billion. And in March, Kraken reached a $1.5 billion deal for futures broker NinjaTrader in March, which was characterized as one of the largest tie-ups ever between trading platforms dealing in crypto and traditional assets. 

Coinbase said the acquisition would establish it as the “premier global platform for crypto derivatives,” a segment it believes will offer enhanced revenue stability and margins.

Read also: What to Know as GENIUS Stablecoin Act Heads to Senate Vote

Positioning Crypto

In an era where the line between tech innovation and financial services continues to blur, crypto companies are making bold bets that the future of finance will be on-chain, borderless, and, of course, built on crypto infrastructure.

When asked what Coinbase could “get up to with banks” during the Q&A session, Armstrong said, “Every bank in the world will be integrating crypto at some point … some are interested in custodial solutions, others in stablecoin solutions.”

And as to whether banks should issue their own stablecoins, Armstrong recommended using existing ones and noted, “Stablecoins have network effects and you want interoperability.”

He added that Coinbase had no plans to acquire a banking license, should regulation allow.

The digital asset exchange’s global playbook in Q1 focused on expanding both access and infrastructure. Regulatory registrations in Argentina, the U.K. and India opened the doors to three high-growth markets. Meanwhile, Coinbase Prime’s custody offering saw assets under custody rise to $212 billion, driven by ETF issuers and corporates seeking secure crypto exposure.

Consumer and institutional transaction revenue — long the lifeblood of Coinbase’s business — totaled $1.3 billion, down 19% quarter over quarter. Still, these figures outperformed global spot trading, which declined 13% during the same period. Subscription and services revenue rose 9% quarter over quarter to $698 million, largely driven by surging stablecoin activity.

See also: Keeping Stablecoins Stable is Complicated: Why CFOs Need to Pay Attention

Revenue from stablecoins reached $298 million in Q1, up 32% quarter over quarter. Coinbase has effectively turned USDC into a financial engine, integrating it into product offerings across loans, rewards and decentralized applications. One example: the launch of bitcoin-backed USDC loans inside the Coinbase app, powered by Morpho’s open-source protocol. Since launch, the platform has seen over $160 million in loan originations.

As trading revenue becomes more cyclical, Coinbase is leaning into more durable income streams. USDC, the second-largest dollar-backed stablecoin, emerged as a star performer. Its market cap surpassed $60 billion for the first time, fueled by institutional adoption and use across Coinbase’s international exchange, which denominates all order books in USDC.

Coinbase offered cautious guidance for Q2, citing market softness in April. The company generated about $240 million in transaction revenue in April, with spot volumes down 12% month over month. It expects Q2 subscription revenue to range between $600 million and $680 million.