Coinbase Global Inc ($COIN) Q1 2026 Earnings Call

Welcome to the Coinbase Q1 2026 earnings call. Before we get into the good stuff, some disclaimers. During today's call, we may make forward-looking statements that may vary materially from our actual results. Please refer to our SEC filings and this slide of the presentation for more information concerning risks, uncertainties, and other factors that could cause these results to differ. In addition, our discussion today will include certain non-GAAP financial measures. Reconciliations to the most directly comparable GAAP financial measures are provided in the earnings presentation on our investor relations website.

Hello everyone, and welcome to our Q1 2026 earnings call. My name's Alesia Haas, and I'm the Chief Financial Officer of Coinbase. You may see a new face on this call with us today. Mike right here right over there. I want to introduce you all to Shaun Aggarwal. Shaun is our Chief Business Officer, and he's in our newest Head of Investor Relations. You're going to see a lot more of him, but I want to tell you a story about Shaun. Shaun is our OG Head of IR. Shaun led our Series E fund raise back in 2018. He was my right hand as we went public in 2021, and I could not be more delighted to introduce you him to his first public company earnings call, and bring him back to this new set of investors that we have with us today. So, welcome Shaun, and I'm going to turn it over to him, and he's going to walk us through our agenda and what to expect at our earnings call today.

Thank you, Alesia, and hi everyone. Really excited to be here and back in the IR seat. As Alesia mentioned, my name is Shaun Aggarwal, and I'm the Chief Business Officer and Head of Investor Relations at Coinbase. I'll be MCing our call today, and in addition to Alesia and I, I am joined by my esteemed colleagues, Brian Armstrong, our Co-founder and CEO, Emilie Choi, our President and COO, and of course Paul Grewal, our chief legal officer. All righty, diving in. Our agenda today is that we'll start with comments from Brian and Alesia on Coinbase's strategy and Q1 performance. We'll then have time to address questions from both our X and analyst communities. So with that, Brian, over to you.

All right, thanks Sean. So I want to start with our mission, which is to increase economic freedom in the world. Our mission matters for everyone because 4 billion people are locked out of the financial system globally. The unbanked and the unbrokered. Crypto fixes this by giving everyone equal access to property rights, stable currency, and permissionless financial services. Now let's take a look at the state of the market. Despite the crypto market being down, the fundamental growth of the on-chain economy is strong. All of finance is moving on-chain because crypto provides faster, cheaper, and more efficient financial infrastructure. Crypto trading volumes have grown more than 50X in the last 7 years. Stablecoin market cap is now more than 300 billion and growing fast. Tokenized real-world assets are scaling and expected to hit 16 trillion by 2030. And now crypto has a new catalyst: AI. There will soon be billions of agents transacting and they need rails that can keep up. Crypto is the only option that checks all three boxes: fast, cheap, and global. To summarize, the world economy is moving on-chain and Coinbase was built to capitalize on this transition. Here's why. First, we're the most trusted brand in crypto. Individuals and businesses trust us to store more crypto than any other company in the world. Second, we've pooled global liquidity on our centralized exchange, creating a powerful network effect. Third, we're the largest regulated stablecoin platform in the world. And fourth, we have a proven track record of building and scaling frontier products. In short, we believe Coinbase is well positioned to win as the world increasingly moves on chain. You're probably familiar with Coinbase's products, but if not, here's a quick reminder. We serve three main customer groups: consumers with our retail, advanced trading, and self-custody apps, institutions with our prime brokerage platform, and for developers, we have CDP or Coinbase Developer Platform, our one-stop shop where any company can integrate crypto. And the most powerful part of our product suite is that they are all built on a shared infrastructure that creates network effects and economies of scale across our platform. You can see the full stack architecture of Coinbase here. How it works is our battle-tested custody stores more crypto than any other company, our settlement rails are fast, cheap, and global, our exchange offers deep liquidity from our multiple customer groups, stablecoins like USDC enable efficient money movement, and it's all supported by a decade-plus track record of leaning into regulation and compliance around the world. Now, let's get into Q1. We faced headwinds with a softer trading market this quarter, but we executed well on what was in our control. We saw huge growth in derivatives trading volume driven by our everything exchange. We hit a new all-time high in USDC held in Coinbase products, and saw 10x year-over-year growth in stablecoin transactions on Base. We're also leading on the next frontier with over 90% of on-chain agentic transaction volume happening on Base. So, let's walk through some of our key metrics. First, crypto trading market share. Despite the market being down, we continue to grow share globally and reached a new all-time high. When market conditions are difficult, we see customers consolidate activity on platforms they trust. Next, let's touch on assets on platform. In short, Coinbase stores more crypto than any other platform, and despite asset prices being down, Q1 marked the 12th consecutive quarter of net native unit inflows. This is a key part of our strategy. Our most trusted brand attracts assets on platform, which leads to customers adopting more products. Finally, I want to highlight stablecoin growth this quarter. USDC growth on our platform has hit another all-time high despite broader crypto market performance. We are the largest distributor of USDC with more than 25% of all USDC held in our products. Importantly, we capture about 50% of all USDC economics. Moving into an update on our 2026 priorities, which we've told you about in prior sessions, we've made significant progress against our top three priorities this quarter. As a reminder, these are the everything exchange, so users can trade every asset in one place, stablecoins and payments, enabling money to move at the speed of the internet, and bringing trading and payments on chain. I'll give a quick overview of each of these. So, first, how we're growing the everything exchange. We heard from customers that they wanted to trade more than just crypto on Coinbase, and I'm excited to share that in the past year we've transformed Coinbase from a primarily spot-focused crypto platform into a place where you can now trade any asset class. We've added stock trading, 24/7 equity perps, retail access and geographic expansion for derivatives. We've added prediction markets. We're starting to see real traction now, validating our everything exchange strategy. Derivatives trading is now over 200 million in annualized revenue. Prediction markets are scaling fast, reaching 100 million in annualized revenue in March. That's just two months after launch. And we added non-crypto contracts like silver, gold, oil, which saw more than 4x growth quarter over quarter. Next, Coinbase is driving stablecoin adoption worldwide. Coinbase has a full-stack stablecoin solution across USDC, Base, and Coinbase developer platform. We're seeing this bundle accelerate adoption of stablecoins. First, total stablecoin supply has doubled over the last two years, and USDC is taking a bigger share of that growing pie. Second, stablecoin transaction volume doubled this quarter, and USDC and partner stablecoins drove more than 80% of that total volume. Lastly, the third chart shows how Base is now the dominant chain for all stablecoin transactions with 62% share. And we're also building stablecoin infrastructure for agents. So, USDC and Base are now powering the majority of on-chain stablecoin transactions for AI agents. And when agents pay with crypto on chain, they use USDC 99% of the time. And over 90% of those transactions are happening on the Base chain in Q1. We're seeing agents also use the X402 protocol for a wide variety of use cases, including trading, AI inference, media generation, storage, and more. In short, Coinbase is at the center of the agent economy. And lastly, our third priority for 2026, growing on chain, we continue to make DeFi easy to use through our Coinbase app. DEX volumes grew 2x quarter over quarter, and borrow and balances have grown to over a billion dollars in the last year. So, to wrap up, the future of finance is on chain, and Coinbase is the company best positioned to power it. Crypto's updating every aspect of the financial system. Coinbase has a full-stack solution across multiple customer groups, and agentic commerce is the next frontier. With that, I'll hand it over to Alicia.

Thank you, Brian. In Q1 2026, we generated $1.4 billion of total revenue. A quarterly net loss of $394 million, and $303 million of positive adjusted EBITDA. We're going to unpack these results and more in the following slides. But before we dive deeper into the numbers, I want to step back and give you our assessment of the quarter. Because the headline figures alone don't tell the full story. We are controlling what we can control, and the underlying business performed well. As Brian shared, we reached a new all-time high in crypto trading market share. We posted our 12th consecutive quarter of native unit growth. We saw green shoots in the everything exchange from derivatives and prediction markets. We came in under our expense guidance. Against this backdrop, macro conditions were genuinely tough. Total crypto market cap and total crypto trading volume were both down more than 20% quarter over quarter. And volatility in the long-tail assets were at historic lows. The bottom line is that we saw price headwinds outpace the strong growth of this quarter, but our fundamentals remain strong. Our Q1 results underscore the message we control what we can control. And when we look at our results versus the outlook we provided in February, we delivered within or better than every range we set. Total revenue for Q1 was down 21% quarter over quarter, reflecting the softer market backdrop. As a reminder, our revenue is inherently non-linear. A significant portion moves in line with crypto asset prices and trading volumes. What matters is our ability to build and grow our product suite and assets on our platform through these cycles and show long-term growth even amidst the short-term volatility. Drilling into our transaction revenue of $756 million, consumer was 567, down 23% compared to a 35% decline in the overall consumer spot volumes. There were two factors at play here. One, we saw a mix shift towards consumer core trading away from advanced. Second, we see accelerating contributions from our newer products like derivatives and prediction markets, which contribute to our total revenue, but are not included in trading volume key business metric, which is spot crypto only. On the institutional side, revenue of 136 million declined 27% alongside volumes. Subscription and services revenue was 584 million dollars, down 16% quarter-over-quarter. We saw continued strength in native unit inflows. However, this growth was offset by prices and rates. Stablecoin revenue was 305 million dollars. Average USDC held in Coinbase products reached a new all-time high of 19 billion dollars. A quick reminder here. Our USDC contract auto renews every 3 years into perpetuity. It cannot be terminated. I also want to flag a reporting change we made in the first quarter. We reclassified 18 million dollars of corporate stablecoin revenue to other revenue. This change reflects our treatment of cash and USDC as completely fungible within our corporate operations. And this is consistent with our decision earlier this year to report payment stablecoins as cash and cash equivalents on our balance sheet. We've recast historical periods for comparability. Blockchain rewards were 101 million dollars, down on price and protocol reward rates. But importantly, we saw native unit growth in staked balances. Interest and finance fee revenue was 68 million dollars, up 13% quarter-over-quarter. Average daily loan balances reached 1.4 billion, and active customers grew double digits. Last, I want to highlight Coinbase One, now over 1 million paid subscribers. A sign that the product value proposition is resonating independent of the broader macro market conditions. It's important to note that Coinbase One members generate incrementally higher trading volume, higher revenue. They are most engaged customers in the products across the portfolio, and they exhibit strong unit economics. Revenue diversification is one of our key financial objectives. We are proud to have 12 products generating more than 100 million in annualized revenue. Our retail derivatives business, as Brian mentioned earlier, reached a new all-time high in Q1, generating revenue at an annualized run rate exceeding 200 million, and putting it on track to be our next product to hit the $250 million product tier. Prediction markets is also tracking well, and it's on track to be the 13th product to cross 100 million in annualized revenue in its second month of meaningful operations. We remain focused on revenue diversification, and we're really encouraged by the breadth of this portfolio and our ability to launch and scale $100 plus revenue lines. Our total operating expenses were $1.4 billion, down 5% quarter over quarter. Tech and dev was $526 million, up modestly, driven by one-time costs related to acquisitions completed in Q4 2025. G&A declined 17% quarter over quarter, as we got a head start on expense reductions driving declines in deal-related legal costs, customer support costs, and policy-related expenses. This is our 13th consecutive quarter of positive adjusted EBITDA, spanning bull markets, bear markets, and everything in between. We believe this track record is one of the clearest demonstrations of our commitment and the durability of our business model. We ended the quarter with over $10 billion in cash and cash equivalents, and total available resources of $12 billion. We have the flexibility to invest through the cycle. We can pursue strategic opportunities. We can return capital to shareholders via share purchases, all simultaneously. I wanted to remind you that our 2026 convertible notes are due on June 1st. Unless the notes reach the defined conversion price, we do intend to retire the $1.3 billion obligation. In Q1, we repurchased approximately 6 million shares for $1.1 billion. Our cumulative buybacks have roughly offset 90% of shares that we issued for employee compensation since Q4 of 2024 forward. Turning to our outlook. We expect subscription and services revenue in the range of $565 to $645 million. With an opportunity for quarter-over-quarter growth. We expect technology and development and general and administrative expenses to continue to come down sequentially. With a range of $820 to $870 million in Q2, down 4 to 9% from the first quarter. In addition to our recurring expense outlook, we expect to incur $50 to $60 million in restructuring expenses related to the headcount reduction we announced earlier this week. This will be recognized as a standalone restructuring line item in our Q2 financials. As we mentioned in Tuesday's announcement, we are transitioning to be an AI native company. Our product velocity is already increasing rapidly. The number of pull requests per engineer is up almost 80% year-over-year. And importantly, our focus on quality is scaling even faster. Integration test coverage across core services is up 3x in the last 6 months. The ability to scale our team members and their ability to iterate and improve our products at these speeds is a game-changer for our execution throughput and efficiency. Before I close, we wanted to provide an annual adjusted expense outlook in addition to our quarterly expense outlook. We define adjusted expenses as technology and development plus general and administrative plus sales and marketing less the amortization of intangibles. We expect 2026 adjusted expenses to be between 4.3 and 4.6 billion dollars. This is roughly $500 million lower than our Q4 2025 annualized exit rate at the midpoint. And I also want to point out that absent any growth in USGC rewards, we would expect 2026 expenses to be flat to 2025. With that, this concludes our prepared remarks, and I will hand it back to Sean to moderate Q&A.

Thanks, Alicia. We're going to transition over to Q&A. For this quarter, we're going to take a mix of questions from both our X and our analyst community. All the questions are being submitted to us in writing, and we'll try to get broad coverage across topics that folks are interested in. So, to start, we'll talk about one that's top of mind for a lot of folks, regulation. So, for Paul, question comes from James Yaro at Goldman Sachs, who asks, 'Could you comment on the status of the Clarity Act? How do you expect this bill to evolve, and what are your latest views on the impacts to the business?'

Thanks Paul. Yeah, a lot of good discussion on the rewards topic, but clarity is about much more. And so for Brian, this question from Ken Worthington at JP Morgan. You and the crypto community seem to have come to a compromise on legislation particularly around stablecoin rewards, but you were also concerned about DeFi regulatory authority and tokenized securities. When legislation comes out and gets signed into law from your perspective, what are the things that you expect to see over the next year in terms of who new will be participating in the crypto ecosystem? And what do you expect they will be doing?

Yeah, well you're correct that the Clarity Act is about much more than just stablecoins and rewards. I think as Paul mentioned it will create a lot of opportunities for people to work on tokenization, having clarity about what's a commodity versus a security, exchanges, custodians what their roles are, you know, DeFi has an important role to play here. Self-custodial wallets and so there's going to be lots of energy that comes out of it. I think it's going to be a little bit like when the Genius Act passed for stablecoins and we saw a couple hundred large companies in the US come out in the subsequent months and announce integrations with stablecoins. And so this means that hopefully lots of companies post in a world post clarity being passed will come out and start to integrate crypto. They might use it to raise money on chain. They might use it to provide crypto services to their customers. I think it'll just unlock a lot of institutional capital that will flow into the space broadly. And the opportunity is really there for Coinbase to go provide those services to all these companies coming into crypto post clarity being passed into law and actually power integrations for many of them as well via Coinbase developer platform. So we think it's going to be very additive. We want every company to be integrated into the crypto enabled financial system just like they use the internet or AI or any other technology. And Coinbase can provide those services to them. So that's what we plan to do.

Great. Okay, last question on this theme. This one for Paul and Alicia from Paul Christensen at City who asks, would changes in stablecoin rewards policy lead to changes in contractual revenue share mechanics with Circle?

I don't know how much to add. I just think it's important to know that the revenue share is tied to overall USDC supply and adoption and it's really unaffected by any rewards language.

Great. Okay. Transitioning we got a question from one of our ex-analysts at Architect 9000 who asks, 'It was fairly alarming in your note earlier this week, Brian, to hear that non-technical developers are pushing AI code into production. Is that really true? And how is Coinbase going to marry AI's ability to move fast while preserving high quality and brand trust?'

Yeah, so I should have made this more clear in my note, but you know, we encourage product managers, designers, other non-technical employees to use AI agents to draft code. That's getting easier to do, but human engineers still review all code before it goes into production. In some cases, we have multiple review levels from human engineers just on the most sensitive systems, etc., as you can imagine. So, it's important to realize, and I think your question points at this, AI agents are not just about increasing speed of execution in terms of code or enabling lots more people to write it. It's also going to raise the bar on quality and cybersecurity. And we saw a glimpse of this recently actually with the Mythos model that Anthropic put out where it's actually able to find security vulnerabilities that 99% plus of human engineers would not have been able to find. So, I think that it's important to lean into this as an opportunity to raise quality and cybersecurity standards with AI agents. It's a little bit like self-driving cars, you know, they're getting to a place where they're actually safer than human drivers. And so, there will be a point, I think, in the future where non-technical people will be able to write code, AI agents will be able to review it, and check it for security, improve the quality of it, and actually in certain situations have it go to production, but that's not yet the case today. And so, we want to make sure at Coinbase we are leaning into the frontier, rigorously testing these things often times in parallel to make sure it has a proven track record. And if we see it consistently exceed the standard of what a human could do in certain situations, it would be irresponsible not to automate it further. So, that's how we're going to stay on the frontier.

And I just wanted to underscore the comments that I made in opening comments that our investment in quality, our investment in integration testing is exceeding the pace of our growth in new pull requests. So, we are definitely investing in the testing required to drive up quality on our platform.

All right, thanks for that. Switching gears a little bit for Emily. Question from Ramsey Al-Assal at Canaccord Genuity, who asks, 'You were gaining market share recently. Can you give us an update on the competitive environment and on the drivers that have enabled you to win share despite the down market?'

Yep. We reached an all-time high in Coinbase crypto trading volume market share in Q1 and we gained share in both spot and derivatives globally in a market where total crypto trading volumes were down 20% plus quarter over quarter. Our market share has grown roughly 5x since Q1 2023. And what we found is that when conditions are difficult, people go to where they trust. So, this is the 12th consecutive quarter of net new unit inflows for us. Share gains have been driven by product innovation and expansion of our derivatives platform, including launching derivatives in our flagship Coinbase app and adding support for non-crypto contracts. Our everything exchange strategy is validating. Retail derivatives are at 200 million plus of annualized revenue. Prediction markets are at 100 million plus of annualized revenue in March. And incremental revenue cross-sold into a customer base we've already acquired. So, it's very positive. We do also believe that share captured in down markets will be sticky as conditions improve.

Great. Let's switch gears a little bit and talk about stablecoins. So this question also for you, Emily, from Andrew Jeffrey at William Blair. Can you talk a little bit about what the extent of your stablecoin movement infrastructure ambitions are? Is Coinbase content with being a CPN participant, or is the company looking to expand offerings such as settlement?

So we have built a faster, cheaper global settlement layer, and we intend to fully leverage it. We have the full stack. We are the primary distributor of USDC as the digital dollar, Base as the settlement layer, our payments APIs as the enterprise integration layer, and X402 is the open standard for the next wave of agentic commerce. We have a vertically integrated stack that no other company in the world owns end-to-end. We're not playing as a network participant. We are the platform that powers stablecoins. The market opportunity is pretty massive here, and we still think it's quite early in the cycle.

Okay. Let's continue on that theme a little bit and talk about agentic and AI-native finance. For Brian, question from Ryna Kumar at Oppenheimer. As we get closer to the commercialization of agentic payments at scale, can you talk about the particular opportunity you see for X402? Specifically, how should we think about incremental USDC on platform growth from X402 adoption? And over time, how meaningful could transaction fees on Base and from the X402 facilitator really become?

Yeah, so thanks for following X402. For anybody who doesn't know, this is an open protocol that we incubated within Coinbase for agentic commerce. It allows agents to spend small or large amounts attached to any request whether that's to e-commerce checkout or any other agent in the world and we're seeing this emerging area of agentic commerce really start to take off. We've subsequently opened this protocol and put it as part of the Linux Foundation and lots of other companies have come in to contribute to it and oversee the governance of it including Cloudflare, AWS, Stripe, Shopify, Google. And so it's currently the most popular open standard for agentic commerce which is great. So your question asked about how this helps Coinbase, well there's a couple ways. One is that 99% of the X402 transactions right now are settled in USDC. That's from Q1 and so we obviously monetize USDC via our relationship with Circle which is good. 90% of the agentic stablecoin transaction volumes were settled on Base in Q1. So Base is the leading chain now and it just makes sense that, you know, there's lots of companies who can build on X402. It is truly an open standard but because it was incubated within Coinbase, we have really great APIs inside Coinbase developer platform for instance that let people integrate with X402, put it into any checkout that they want to make, you know, agentic enabled. And so it's been a really nice thing that's grown from out of Coinbase to become an open standard that has secondary effects on all of our various products. This kind of speaks to the full stack solution that Emily was mentioning. I think we're really the only company that owns that full stack you know, incubating X402, Coinbase developer platform, Base and USDC. These are all products that we either co-created or helped create and it's been a really great journey to see that all those pieces come together to become the leading stack for agentic commerce.

All right. Switching gears just slightly. We talked a little bit about stablecoins and payments. You know, one of our top priorities is the everything exchange, of course. So, Alicia, question from Patrick Moley at Piper Sandler, who asks, as you scale the everything exchange across equities, prediction markets, and commodities, how should investors think about the monetization timeline and the revenue contribution from these new asset classes relative to your core crypto trading business over the next 12 to 18 months?

Thank you for the question, Patrick. So, as you heard in our opening comments, the everything exchange is already moving the needle. We highlighted retail derivatives growth that's now on track for $200 million annualized. Prediction markets is one of our fastest growing new products that as of March was $100 million annualized. And this is all less than 2 months after go live. So, we are seeing really nice green shoots from these new products that we rolled out with everything exchange. We believe that the non-crypto assets are starting to also gain traction. They were 4x quarter-over-quarter in terms of volume from silver, gold, oil. So, this is really tangible signs that our decision to expand out the tradeable assets on the everything exchange is seeing traction with our customers and seeing engagement. So, we hope to have more news to share with you next quarter. We're not going to give an outlook on a per product basis. Our whole goal is to grow our total trading volume market share as we did this quarter to continue to penetrate these new asset classes and engage more and more customers with them.

Great. Maybe continuing on that theme, let's talk about something super fun at least within the Coinbase walls. Talk about crypto options. So, Alicia, Owen Lau at ClearStreet asks, could you please give us an update on launching crypto options trading in the US and the timing of that? What are the major hurdles in front of you?

Great question, Owen. So, as many of you know, we closed the Deribit transaction last year. Deribit was the clear leader in terms of institutional clients and professional market makers in trading options. We are very focused on this integration right now. It is progressing nicely, and we expect to be fully integrated in 2026. This means that we're going to unify spot, perps, futures, options all on a single platform. That's going to provide deep liquidity. That's going to provide efficiency across these various asset classes. This is you're going to hear incremental milestones as we go through the year towards this outcome. On the US specifically, I cannot give you a timeline on today's call, but we're actively working on it and very optimistic. So, coming soon. On a global basis, if I could zoom out and talk about derivatives globally as well, both of our exchanges, both the US and international derivatives exchanges, achieved new all-time highs in the quarter in terms of revenue contribution. This is included in our institutional transaction revenue line, and the institutional derivatives revenue more than offset any declines that we saw in option activity in Deribit during the quarter.

Great. Next relatedly for Brian, but crypto volumes have remained under pressure. Sorry, this question from Devin Ryan at Citizens. But crypto volumes have remained under pressure, especially in more speculative token trading. Even as the industry narrative has become increasingly optimistic toward stablecoin tokenization and utility-driven on-chain activity. Are we in a transition moment where speculative volume is declining before the utility side of the market has produced a step function increase in block space demand? How are you thinking about the timing and magnitude of that shift? And what gives you confidence in the secular growth path for Coinbase transaction volumes?

Yeah. So, this is really part of the reason why we've been investing in the everything exchange. It's to diversify the asset classes that are there. So, in recent quarters, crypto spot trading was down a bit, but as we mentioned, derivatives and prediction markets, some commodities futures, things like that were up, right? So, in any given market, some things always up, some things down. And that's the nature of trading. So, it's important we're diversifying that through the everything exchange. And then we're also diversifying our revenue from a non-trading point of view into what we call subscription and services, of course. And that's now 44% of our net revenue. So, that's a nice balancing factor as well. You had asked about utility. I don't think the utility side is really waiting. I think that we're seeing obviously stablecoins are growing like crazy. Prediction markets, there's really great signs of adoption for tokenization, more broadly. Agent commerce that we mentioned. Even our DeFi integrations such as for DeFi borrow lend are growing really nicely. So, I think the utility side is already here. And we're in kind of this interim period where spot crypto assets were down a bit, other asset classes were up. And as we diversify, these things will get balanced out where we'll just be in a more upward channel over time.

Great. Next for Alicia from Alex Markgraf at KBCM. Can you walk us through the riff? I think many folks are curious to understand how much is a function of the current environment versus AI leverage. And what do you anticipate in terms of cost savings both in quarter and run rate?

Thanks, Alex. Hopefully, the materials that we provided in the earnings presentation go a long way to providing data for this question. But I want to zoom back. So, the restructuring reflects two forces acting simultaneously. It wasn't all one, it's not all the other, and it's hard to just untangle and say what is more or less. We definitely saw market headwinds, and we've definitely also seen a transition to AI native operations. So, as we shared, pull requests are up by engineer by 78% year-over-year. We are seeing continued growth in that, and I think that we're going to only see more and more of our work being done by AI in all of our functions over time. With regard to specific dollars, the actions removed about $500 million of total costs as compared to the Q4 2025 run rate. We provided in our outlook both Q2 as well as full year outlook. The full year adjusted expenses are going to be between 4.3 and 4.6 billion. And excluding that USDC rewards growth, that's roughly flat year-over-year in terms of that adjusted OpEx from 2025 to 2026.

Great. So we'll go to another question from X for Alicia, and this one's from @PresidentNoble, related to fees. Do you plan on lowering fees? Morgan Stanley and other TradFi banks are offering better prices on their brokerages.

Thanks for this. So, our position is as it's been for a long time. Our clients are not choosing us because we're the cheapest. However, we do experiment, and we do look at different fee schedules for our customers. They're choosing us today because we're the most trusted, we're the easiest to use, the most crypto stored, we have 80 licenses, we have a global regulatory foundation. Customers have the choice between trading on our core platform, advanced, or go on to Coinbase One. And so, with this choice, we believe that customers are choosing us for the right product for their needs, not on fees alone. But, over the long term, we've always said that we believe that fees could come down as things become commoditized. And so, our focus on diversifying our revenue is very important. And it's more diversified than ever. We have 12 products with over $100 million of revenue. We've shared with you that we have a really solid forward pipeline of additional products that are scaling and on pace to become our 13th. And so, we are not taking our eye off the ball of the risk of fee compression, but it's not what we're seeing in the near-term business.

Yeah, and I'll just add that, for customers that are more fee sensitive, we have a couple of really great options already. I mean, one is that with a Coinbase One subscription, they can get zero fee trading. So, a lot of customers are taking advantage of that. And then, in Coinbase Advanced for our more prosumer traders, there's very competitive pricing that scales down really to just a few bips at the high end based on volume. So, I think for many of our customers that want to get lower fees or even zero fee trading, we have great options for them.

Great. Next one for Emily from John Todaro at Needham & Co. Institutional transaction revenue declined more than the retail consumer quarter over quarter. Can you frame up the institutional interest in crypto as of late? And if you are surprised to see more weakness in institutional than retail?

Sure. Listen, I think things ebb and flow between institutional and retail, and that's okay. It's how it's always been. For the business, institutional transaction revenue of $136 million declined 27% quarter on quarter, which is in line with macro institutional trends. Lower volatility, reduced hedging demand specifically at Deribit, and options activity declined following all-time high volumes in Q4. That weighs disproportionately on our institutional revenue. Deribit open interest share held steady despite that headwind, and we feel that the Deribit durability of positioning is still very much intact. Underneath the revenue line, institutional engagement was actually quite strong by the end of the quarter. Most of the downtrend happened in January, and active lending clients grew double-digits quarter over quarter. Average daily loan balances hit an all-time high of 1.4 billion. 45 major financial institutions have moved tokenization from concept to production in Q1. Institutions understand the longer-term utility of crypto, and they are definitely positioning ahead of regulation. And on top of that, we have a very strong institutional pipeline that ETFs, including staking, dapps, prime custody activations, that are opening new TAM for us.

Great. And I think we just have time for one last question. This one from X from @CreditBrian. What is Coinbase or Brian most excited about for the next one to three years?

Well, there's lots happening in crypto. I mean, the first is just every asset class is coming on chain, right? Whether it's stocks, prediction markets, commodities, effects, tokenization of all these real-world assets, right? Which is about 30 billion dollars today, expected to be 16 trillion by 2030. So, you know, the trading is just going to get more and more efficient, and more and more of that will flow to on chain. I think the second one is, of course, stablecoins. It's just we're in a golden age right now where payments are now fast, cheap, and global. They can be under 1 second, under 1 cent, anywhere in the world, just like sending a WhatsApp message or something. It arrives instantly almost for free anywhere in the world. That's never been possible before in payments, and we're going to see more and more payments like global GDP essentially flow to these stablecoin rails. And then agentic commerce is really going to be a catalyst on top of all of that where I think increasingly people will rely on these agents to get work done for them. They'll need to get things paid for, and you know, we launched this website agentic.market for instance, that's just a collection of all the different services out there that are AI agent enabled where agents can connect to them, pay transaction fees through the X402 protocol, and get work done on your behalf. And it's just a really exciting time to be building financial infrastructure that's more efficient for the whole world, plus AI agents. And you know, that's what I'm excited about doing in the coming years.

All righty. Well, that concludes today's earnings call. Thank you so much for joining us for this Q1 update, and we look forward to speaking with you all next quarter.