Co-founder and CEO of major US cryptocurrency exchange Coinbase Brian Armstrong has revealed that the firm has been profitable since 2017 and has generated close to $2 billion in transaction fees revenue since its launch in 2012.
Speaking at Vanity Fair’s New Establishment Summit on October 23rd, Armstrong has stated that the exchange has generated more operating profits than the funds it raised from venture capitals.
He further noted that the exchange has turned a profit the last three years, including during the 2018 bear market, and has earned more operating profit than venture capital raised so far, estimated at nearly $550 million in nine funding rounds, according to CrunchBase.
“We were profitable in 2018 and in 2017,” and as well as this year, he stated. However, instead of paying out to the investors, the exchange is focusing on putting the profits in its expansion.
“Most of these profits we’re plowing back into the business to create new products. […] I sort of think of us as the anti-unicorn unicorn… I want Coinbase to be a company of repeatable innovation.”
Armstrong further added that it’s due to technology, which has always been the focus of Coinbase that the exchange has managed to remain profitable.
The San Francisco-based exchange is continuously adding digital coins to offer more options to its crypto traders. Moreover, as a way to boost the crypto ecosystem, the exchange is also heavily investing in startups that work in the development of blockchain technology.
Coinbase was founded in 2012 and is now one of the eight blockchain unicorns globally. The exchange offer a wide range of crypto-based services for both retail and institutional traders. Coinbase was valued at $8 billion in its last funding round, raising money from investors which include Andreessen Horowitz, Y Combinator, and Polychain Capital.
Meanwhile, Coinbase is currently part of Facebook’s cryptocurrency initiative – Libra. When asked about the future of the project, CEO Armstrong replied that he doesn’t know why regulators’ response to the project were preponderantly negative, adding:
“I’d really like to see the U.S. embrace this area of innovation. […] My hope is the U.S. embraces this kind of innovation, even if it comes from a company like Facebook that they’re not necessarily very happy with.”
Coinbase is currently one of the 21 remaining companies included in the Libra Association. The association has been under scrutiny by lawmakers across the world for its potential to put at risk user privacy as well as diregard regulatory rules. Most recently, Libra has lost seven high-profile contributors such as Visa, eBay, Mastercard, PayPal and others.
Earlier this month, Coinbase acquired an Irish e-money license from the Central Bank of Ireland, effectively expanding its European operations. Following this, the cryptocurrency exchange is certified to offer money and banking services throughout the European Economic Area and the EU.