Coinbase Boosts Bitcoin Holdings as Profits Surge in Q3

The exchange boosted its Bitcoin holdings by 2,772 BTC, bringing its total reserves to 14,548 BTC worth about $1.57 billion. This is part of Coinbase’s plan to become an “Everything Exchange.” The company reported $1.9 billion in revenue, up 55% year-on-year, and $432.6 million in net income, fueled by strong trading and subscription revenues. Institutional clients accounted for 80% of Coinbase’s $295 billion trading volume. Meanwhile, CEO Brian Armstrong turned heads after intentionally dropping crypto buzzwords like “Bitcoin” and “Web3” at the end of the earnings call, which instantly resolved prediction markets on Kalshi and Polymarket. Though playful, the stunt caused some debate over fairness in prediction markets and insider influence.

Coinbase Grows Bitcoin Stash

Coinbase greatly strengthened its position in the Bitcoin ecosystem after adding 2,772 BTC to its holdings in the third quarter as part of its attempt to evolve into what it calls an “Everything Exchange.” The company’s total Bitcoin reserves now stand at 14,548 BTC, which is valued at approximately $1.57 billion. 

The latest quarterly report also showed robust financial performance, with net income surging more than fivefold to $432.6 million year-on-year, while total revenue climbed 55% to $1.9 billion.

The gains were largely driven by a resurgence in trading activity and growth in subscription-based revenue streams, which include stablecoin-related income and blockchain rewards. Transaction revenue reached $1.05 billion, while subscription and services revenue increased 34.3% to $746.7 million. Coinbase credited its growth to progress made toward realizing its “Everything Exchange” vision. This is an ambitious plan to offer a comprehensive suite of crypto and tokenized products under one platform.

Coinbase Q3 financial results (Source: Coinbase)

The company said it made headway in Q3 by expanding its lineup of tradable spot assets, enhancing its derivatives offerings, and building the foundation for new verticals, like tokenized stocks, prediction markets, and early-stage token sales. A major component of this strategy is Coinbase’s deepening integration with Circle’s USDC stablecoin to advance stablecoin adoption globally.

Institutional engagement is still a dominant force in Coinbase’s business model. In fact, institutional clients accounted for 80% of the company’s $295 billion trading volume during the quarter. Assets under custody also hit an all-time high above $300 billion. The firm’s $299 million Bitcoin accumulation also proves that Coinbase believes in BTC as a core long-term asset.

Meanwhile, Coinbase’s Ethereum layer-2 network, Base, continued to see strong adoption across trading, payments, lending, and social applications. The company also introduced Flashblocks, a preconfirmation feature that allows for transaction speeds of up to 200 milliseconds. However, CEO Brian Armstrong declined to share updates on the potential launch of a Base token during the earnings call.

Coinbase Boss Turns Prediction Markets

Brian Armstrong also caused quite a stir in crypto prediction markets at the end of the company’s third-quarter earnings call on Thursday when he deliberately dropped a string of crypto buzzwords that instantly resolved two active markets to “yes.” The unexpected move impacted prediction platforms Kalshi and Polymarket, where users placed bets on whether Armstrong would mention specific terms during the call.

Just as the event was wrapping up, Armstrong said, “I was a little distracted because I was tracking the predictions market about what Coinbase will say in their next earnings call, and I just want to add here, the words Bitcoin, Ethereum, blockchain, staking, and Web3, make sure we get those in before the end of the call.” His spontaneous remark instantly determined the outcomes of both markets, which left traders with mixed reactions.

Some of the words that were bet on to be said during the Coinbase earnings call (Source: Polymarket)

Kalshi and Polymarket users wagered $80,242 and $3,912 respectively on the outcome, with only modest sums on the line per participant — no one on Polymarket lost more than $12 on a single bet. While some traders were delighted and praised Armstrong for his playful intervention, others were uneasy over how easily a prediction market could be influenced by insider awareness. 

On X, Armstrong later clarified that his comment was unplanned, and said that it happened “spontaneously when someone on our team dropped a [prediction markets] link in the chat.”

The reaction across both platforms leaned largely positive, with Polymarket users calling Armstrong “the GOAT” and Kalshi traders thanking him for the surprise “gift.” Still, the incident reignited conversations about the integrity of prediction markets, which depend heavily on trust and fair play, especially when participants have insider knowledge.

Beyond the market drama, Coinbase still reported a strong third quarter, and reported a 55% year-over-year increase.