Coinbase Global has said that its revenue will reduce by half in 2022 due to the difficult period the industry is undergoing.
The news was confirmed in an update provided by company CEO Brian Armstrong on Wednesday.
In the update, Armstrong said that the exchange’s revenue will be less than 50% of the FY2021 revenue.
Cryptocurrencies have been rapidly losing their value over the past months, although they are still way ahead of their mid-2010s levels.
Nearly $2tn worth of value was wiped off the market as several prominent companies collapsed and filed for bankruptcy, among which Three Arrows Capital, Celsius Network and Voyager Digital.
The recent collapse of FTX, a leading exchange, was another blow to investors. FTX’s bankruptcy led to $6bn worth of withdrawals in just 72 hours, Coinbase said.
According to estimates cited by Bloomberg News, Coinbase may lose as much as 75% of its revenue in the fourth quarter alone, with the revenue numbers dropping to just $621.5m.
Coinbase has been trying to contain the fallout of the period known as “crypto winter” by methodically addressing the issues that it has faced. However, the exchange has been forced to cut jobs, with 60 people let go in November.
The exchange has blamed the market conditions and challenges for its current performance.
Coinbase, which was the first crypto company to float on a stock market, has also seen its stock price fall by 83% this year, and is one of the worst-performing assets on NASDAQ.