AI interpretation based on checked source excerpts. Issuer assertions and evidence limitations remain explicit.
Policy quality-scores-2: six equally weighted categories. The overall score requires full coverage. Missing inputs are not zero. Qualitative grades are sourced interpretations, not probabilities. 3/6 · 18/10/2026
Moat38
Equal-weight average of four evidence-backed rubric grades (0–4), scaled to 100.
structural advantage · 2/4 · Custody relationships, regulated infrastructure and conditional Circle contract protection are tangible strengths. Penalty-free transaction exit and actual compliance disadvantages prevent treating them as an established company-wide moat.
durability · 1/4 · Contractual renewal protection is conditional, and transaction customers have no contractual lock-in. The supplied record does not demonstrate sustained pricing or customer dependence through market cycles.
customer dependency · 1/4 · Paid-subscriber growth and cross-product activity support engagement, but not dependence. Transaction exit is unrestricted and Coinbase acknowledges realized engagement setbacks.
erosion resilience · 2/4 · Earlier reported share gains, higher customer USDC balances and uninterrupted withdrawals offset substantial 2026 trading contraction and the realized security incident. Market effects prevent attributing contraction entirely to competitive erosion.
Pricing power44
Equal-weight average of four evidence-backed rubric grades (0–4), scaled to 100.
realized pricing · 2/4 · Coinbase monetizes differentiated trading experiences and paid subscriptions, with higher simple-trading fees disclosed. A lower-fee subscription tier and a price-sensitive market temper this evidence. Comparable fee realization over time is unavailable; 2026 revenue and spot-volume movements mix products.
retention · 2/4 · Assessed indirectly from paid-subscriber growth, cross-product activity, higher customer USDC balances and absence of excessive withdrawals. These coexist with acknowledged engagement setbacks and lower trading activity; no retention rate is inferred.
margin resilience · 1/4 · Positive adjusted EBITDA persisted, but declined sharply in the first half of 2026 alongside revenue and operating cash flow. Lower rates and blockchain reward economics also reduced revenue. This demonstrates fragile earnings resilience, without using margins as proof of a moat.
contractual freedom · 2/4 · Transaction prices are determined at each transaction under Coinbase's published fee disclosures, supporting pricing flexibility. Customers can exit without penalty, and stablecoin economics depend on a partner arrangement and reserve income rather than unrestricted price setting.
Predictability—
Missing exact annual revenue, free cash flow or FCF margin; operating cash flow and capex must both be reported for all five years.
Financial strength—
Missing required inputs: debtFcfGrade. Equal-weight grades: debt/FCF (1–8x), net debt/earnings before interest and tax (0–5x), interest service (1–12x), current ratio (0.75–2x). Earnings use reported operating income, or reported pretax profit plus reported interest expense when operating income is unavailable. Interest service uses earnings/interest expense; if unavailable, it uses reported operating cash flow/cash interest paid, without relabeling cash paid as accrued expense. Nonpositive cash flow/earnings score 0 for their service component; reported zero interest with a positive numerator scores 100. Net cash scores 100 for net leverage. Missing disclosures remain unavailable. General nonfinancial-company rubric, not a credit rating; exceptional and nonoperating gains are not normalized out. IFRS finance-cost and cash-flow classifications retain their reported scope.
- netDebtEbitGrade
- 100.00
- interestCoverageGrade
- 100.00
- currentRatioGrade
- 100.00
- Net debt / operating income (x)
- -2.53
- Interest coverage (x)
- 16.81
- Current ratio (x)
- 2.34
Capital allocation—
Missing required inputs: cashConversionGrade. Three-year equal-weight indicators: pretax return on average invested capital (0–25%; equity + debt − cash, each year and its prior year), share-count growth (0–5%, lower better), share-based cost/revenue (2–20%, lower better), consolidated FCF/net income (0–1x). Return uses reported operating income or, if unavailable, EBIT calculated from reported pretax profit plus reported interest expense; exceptional/nonoperating gains are not normalized out. Share-based cost uses the reported cash-flow add-back or, if absent, separately reported recognized compensation expense; the latter never becomes an FCF adjustment. Nonpositive net income scores 0 for cash conversion; absent income/FCF stays unavailable. Nonpositive invested capital has no defined return and remains unavailable. Does not establish acquisition quality or buyback timing.
- 3-year pre-tax operating return (%)
- 18.91
- 3-year average dilution (%)
- 5.37
- 3-year average SBC / revenue (%)
- 16.90
Management50
Equal-weight average of four evidence-backed rubric grades (0–4), scaled to 100.
capital discipline · 2/4 · Substantial 2025 operating cash generation supported actual repurchases and investment. The stock-heavy Deribit acquisition, increased crypto purchases, debt financing, contractual commitments and rising compensation expense create mixed evidence; acquisition returns and net dilution benefits are not established.
incentive alignment · 2/4 · The existing CEO award has stock-price conditions, actual disclosed vesting and a holding requirement. The granted 2026 COO award adds multiyear operating and relative-return conditions, whose achievement is not yet demonstrated. Significant recurring equity compensation and incomplete ownership coverage limit the conclusion.
execution · 2/4 · Assessed from operating outcomes: earlier subscriber and reported market-share gains, institutional custody adoption and substantially completed restructuring show execution capability. The costly data theft incident and 2026 contraction are counterweights; institutional revenue growth was mainly acquired.
governance · 2/4 · Independent committees, a lead independent director and annual board elections provide actual governance safeguards. Dual-class control, shareholder restrictions and combined chairman and CEO roles materially limit outside accountability; oversight effectiveness is not established by policy disclosures alone.
Evidence
For example, we serve as a custodian for several Bitcoin and Ethereum ETF issuers.
Business / custody / ETF issuer relationships · Filed 12/02/2026
We charge institutions a separate fee based on the total assets stored in custody on our platform.
Business / institutional custody fees · Filed 12/02/2026
The Company holds full keys to crypto assets and payment stablecoins held or managed on behalf of its customers totaling $376.1 billion and $404.0 billion at fair value at December 31, 2025 and 2024, respectively.
Commitments and contingencies / customer assets held with full keys · Filed 12/02/2026
Our subsidiary, CCTC, operates as a New York State-chartered limited purpose trust company, which is subject to regulation, examination, and supervision by the NYDFS.
Regulation / New York limited purpose trust company · Filed 12/02/2026
Due to our regulated status in several jurisdictions and our commitment to legal and regulatory compliance, we have not been able to offer many popular products and services, including products and services that our unregulated or less regulated competitors are able to offer.
Risk factors / actual competitive product restrictions · Filed 12/02/2026
We also have expended significant managerial, operational, and compliance costs to comply with laws and regulations applicable to us in the jurisdictions in which we operate, and expect to continue to incur significant costs to comply with these requirements, which these unregulated or less regulated competitors have not had to incur.
Risk factors / actual comparative compliance costs · Filed 12/02/2026
During the year ended December 31, 2025, we paid $311.2 million of cash related to the Data Theft Incident, comprising voluntary customer reimbursements and direct legal costs.
Cybersecurity / 2025 incident cash payments · Filed 12/02/2026
No passwords or private keys were compromised as a result of this incident.
Cybersecurity / passwords and private keys · Filed 12/02/2026
•an increase in custodial fee revenue reflecting growth in average crypto assets and USDC under custody of $81.5 billion primarily driven by higher crypto asset prices, mainly Bitcoin, Solana, and Ethereum; and
MD&A / custody revenue growth and asset-price effects · Filed 13/02/2025
•Coinbase One: Coinbase One is a consumer subscription product for which consumers pay a monthly or annual fee to unlock a variety of benefits, including limited reduced transaction fee trading, USDC rewards, higher staking rewards than non-Coinbase One subscribers, priority customer service support, and offers from third-party partners.
Business / Coinbase One subscription benefits · Filed 12/02/2026
•an increase in other subscription and services revenue primarily due to growth of $87.9 million in Coinbase One revenue, as the number of paid subscribers grew driven by positive market conditions and improvements to our product offerings, and an increase in revenue from expanding supported assets on our developer products.
MD&A / Coinbase One revenue and paid-subscriber growth · Filed 13/02/2025
Coinbase One users engage with the rest of our product suite, generating trading revenue, staking commission, credit card interchange fees, and more.
Business / Coinbase One cross-product engagement · Filed 12/02/2026
In 2025, we launched an additional subscription tier, Coinbase One Basic, offering consumers essential benefits for a lower subscription fee.
Business / lower-fee Coinbase One Basic launch · Filed 12/02/2026
Contracts with customers are defined at the transaction level as they are open-ended and may be terminated by either party without penalty.
Revenue recognition / transaction-level termination terms · Filed 12/02/2026
We must also expand our products and services, and offer competitive prices in an increasingly crowded and price-sensitive market.
Risk factors / competitive prices and market price sensitivity · Filed 12/02/2026
From time to time, certain of these factors have negatively affected customer retention, growth, and engagement to varying degrees.
Risk factors / realized retention and engagement setbacks · Filed 12/02/2026
Transaction revenue Three Months Ended June 30, Change Six Months Ended June 30, Change (in thousands, except %) 2026 2025 $ % 2026 2025 $ % Consumer, net $ 451,670 $ 649,908 $ (198,238) (31) $ 1,018,569 $ 1,745,414 $ (726,845) (42) Institutional, net 100,073 60,819 39,254 65 235,799 159,707 76,092 48 Other transaction revenue, net 47,413 53,543 (6,130) (11) 100,613 121,357 (20,744) (17) Total transaction revenue $ 599,156 $ 764,270 $ (165,114) (22) $ 1,354,981 $ 2,026,478 $ (671,497) (33) % of net revenue 52 55 54 61 31 Table of Contents Transaction revenue decreased for the three and six months ended June 30, 2026 as compared to 2025, primarily reflecting: •a decrease in consumer transaction revenue driven by $230.4 million and $822.0 million, reflecting a 38% and 48% decrease in consumer Crypto Spot Trading Volume1, offset in part by growth in derivatives trading volume and the launch of prediction markets trading; and •an increase in institutional transaction revenue, due mainly to the acquisition of Deribit in August 2025.
MD&A / consumer volumes, transaction revenue and acquired institutional growth · Filed 30/07/2026
If such modifications are not agreed upon, the Circle Agreement will automatically renew for additional three-year terms unless we or Circle fail to meet the conditions specified in the Circle Agreement.
Business / Circle agreement conditional renewal · Filed 12/02/2026
These conditions are the satisfaction of a Product Threshold, a Company Threshold, and a Reseller Threshold (as defined in the Circle Agreement).
Business / Circle agreement threshold conditions · Filed 12/02/2026
If the conditions are satisfied, the Circle Agreement cannot be terminated.
Business / Circle agreement conditional termination restriction · Filed 12/02/2026
Subscription and services revenue decreased for the three and six months ended June 30, 2026 as compared to 2025, reflecting: •changes in stablecoin revenue, primarily consisting of a decrease of $55.9 million and $113.4 million due to lower average interest rates, offset in part by an increase due to higher average USDC balances held by customers in eligible Coinbase products; and •decreases in blockchain rewards of: ◦$56.5 million and $131.3 million due to lower average crypto asset prices, driven primarily by Solana; and ◦$16.1 million and $48.3 million due to lower reward rates, primarily for Solana and Ethereum.
MD&A / customer USDC balance growth and interest-rate effects · Filed 30/07/2026
The Company’s revenue from this arrangement is determined based on the daily income generated from the reserves backing USDC, which is dependent on the total USDC market capitalization, defined as the total amount of USDC in circulation, less the management fees charged by non-affiliated third parties managing such reserves and certain other expenses (the “Payment Base”).
Revenue recognition / USDC reserve-income arrangement · Filed 13/02/2025
Separate from any renewal, there are certain circumstances under which the parties could initiate a restructuring of the agreement.
Business / Circle agreement restructuring circumstances · Filed 12/02/2026
Subscription and services revenue Three Months Ended June 30, Change Six Months Ended June 30, Change (in thousands, except %) 2026 2025 $ % 2026 2025 $ % Stablecoin revenue(1) $ 292,147 $ 308,914 $ (16,767) (5) $ 597,582 $ 582,951 $ 14,631 3 Blockchain rewards 83,342 144,535 (61,193) (42) 184,191 341,127 (156,936) (46) Interest and finance fee income 66,128 59,316 6,812 11 133,933 122,402 11,531 9 Other subscription and services revenue 113,528 119,478 (5,950) (5) 222,962 260,376 (37,414) (14) Total subscription and services revenue $ 555,145 $ 632,243 $ (77,098) (12) $ 1,138,668 $ 1,306,856 $ (168,188) (13) % of net revenue 48 45 46 39 ____________________________________ (1) During the first quarter of 2026, we revised the presentation of revenue earned on corporate payment stablecoin balances, now presenting the amounts in Corporate interest and other income rather than in Stablecoin revenue.
MD&A / subscription and services revenue and presentation change · Filed 30/07/2026
The transaction price, determined at the transaction level, is calculated based on volume and varies depending on payment type, transaction value, and the Company’s published fee disclosures.
Revenue recognition / transaction price determination · Filed 12/02/2026
Generally, simple trading fees are higher than those on advanced trading because advanced traders typically trade at higher volumes than simple traders.
Business / simple versus advanced trading fees · Filed 13/02/2025
The following table provides a reconciliation of net (loss) income to Adjusted EBITDA (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2026 2025 2026 2025 Net (loss) income $ (359,468) $ 1,428,900 $ (753,585) $ 1,494,508 Adjusted to exclude the following: (Benefit from) provision for income taxes (35,943) 394,873 (106,531) 411,721 Interest expense 22,516 20,535 45,085 41,046 Depreciation and amortization 64,403 33,901 132,409 67,234 Stock-based compensation expense 238,341 196,160 486,396 386,889 Data Theft Incident (recoveries) losses, net (33,854) 306,654 (25,244) 306,654 Losses (gains) on crypto assets held for investment, net 209,499 (362,053) 691,855 234,598 Restructuring 52,408 — 52,408 — Other expense (income), net(1) 49,908 (1,506,905) (11,733) (1,500,717) Adjusted EBITDA $ 207,810 $ 512,065 $ 511,060 $ 1,441,933 __________________ (1)See Note 17.
MD&A / GAAP results and adjusted EBITDA reconciliation · Filed 30/07/2026
100 Table of Contents Cash flows The following table summarizes our Consolidated Statements of Cash Flows (in thousands): Year Ended December 31, 2025 2024 Net cash provided by operating activities $ 2,426,383 $ 3,103,935 Net cash used in investing activities (2,049,550) (201,003) Net cash provided by financing activities 740,282 2,903,078 Net increase in cash, cash equivalents, and restricted cash and cash equivalents $ 1,117,115 $ 5,806,010 Change in customer custodial cash and cash equivalents $ (754,370) $ 1,634,934 Operating activities Our largest source of cash provided by operating activities are revenues generated from transaction fees.
MD&A / 2025 and 2024 cash flows · Filed 12/02/2026
Notes to Condensed Consolidated Financial Statements (Unaudited) acquisition, subject to customary post-closing adjustments, was $4.3 billion, consisting of the following (in thousands): Cash $ 721,460 Class A common stock of the Company(1) 3,573,092 Total purchase consideration $ 4,294,552 __________________ (1)Fair value, representing the closing market price of the Company’s Class A common stock on the acquisition date.
Acquisitions / Deribit cash and stock consideration · Filed 30/07/2026
Stock-based compensation The following are the effects of stock-based compensation on the Condensed Consolidated Statements of Operations and Condensed Consolidated Balance Sheets (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2026 2025 2026 2025 Statements of Operations Technology and development $ 152,917 $ 117,240 $ 313,558 $ 225,332 Sales and marketing 12,601 14,533 27,412 29,438 General and administrative 72,823 64,387 145,426 132,119 Total stock-based compensation expense $ 238,341 $ 196,160 $ 486,396 $ 386,889 Balance Sheets Software and equipment, net(1) $ 4,707 $ 12,020 $ 9,105 $ 28,585 _______________ (1)Represents capitalized stock-based compensation that was recorded to Software and equipment, net during the periods presented.
Stock-based compensation / 2026 expense · Filed 30/07/2026
•$790.2 million in cash used to repurchase approximately 3.0 million shares of our outstanding Class A common stock; and
MD&A / actual 2025 share repurchases · Filed 12/02/2026
•a $1.6 billion net increase in proceeds from long-term debt, driven by the August 2025 issuance of our 2029 Convertible Notes and 2032 Convertible Notes, offset in part by prior year proceeds from the issuance of our 2030 Convertible Notes, less cash paid for associated capped calls.
MD&A / increased debt financing proceeds · Filed 12/02/2026
•a $578.0 million increase in cash and cash equivalents used for net purchases of crypto assets held for investment; and
MD&A / increased crypto investment purchases · Filed 12/02/2026
As of December 31, 2025, 5,613,522 of these options have vested, including 2,453,592 during the year then ended, while vesting of the remainder is subject to market conditions contingent on the Company’s Class A common stock price achieving certain stock price target milestones.
Stock-based compensation / actual CEO option vesting · Filed 12/02/2026
The stock option is earned upon the achievement of performance conditions based on the Class A common stock price targets set forth in the table below during the 10-year term of the stock option based on the volume weighted average price of our Class A common stock as reported on Nasdaq at or above the price target for 60 consecutive trading days at any time during the term of the award, and upon certification by the Compensation Committee of the achievement of the stock price targets.
Executive compensation / CEO stock-price performance conditions · Filed 24/04/2026
Mr. Armstrong must hold any shares that he acquires pursuant to the 2020 CEO Performance Award for one year following the date on which such shares become vested or, if earlier, upon an acquisition of the Company, except to satisfy certain tax withholding obligations, or the 10-year term of the stock option.
Executive compensation / CEO award holding requirement · Filed 24/04/2026
The 2026 COO Performance Award is subject to vesting based upon achievement of certain cumulative revenue, cumulative adjusted EBITDA, and relative total shareholder return target values for the period commencing January 1, 2026 and ending on December 31, 2028, subject to her continued employment.
Executive compensation / granted 2026 COO performance award conditions · Filed 24/04/2026
•A majority of our directors are independent; •Our Board of Directors is currently declassified, and directors are elected on an annual basis; •Our Board of Directors has a Lead Independent Director, who is elected annually, has well-defined rights and responsibilities, and is separate from the Chairman of the Board of Directors; •All committees of the Board of Directors are 100% composed of independent directors; •We have comprehensive risk oversight practices, including for cybersecurity, data privacy, legal and regulatory matters, and other critical evolving areas; •Independent directors conduct regular executive sessions; •Directors have regular access to management and maintain open communication and strong working relationships among themselves; and •We conduct annual Board of Directors, committee, and individual director self-evaluations.
Governance / board independence, annual elections and oversight practices · Filed 24/04/2026
Our certificate of formation and bylaws include provisions that: •permit our board of directors to establish the number of directors and fill any vacancies and newly-created directorships; •require super-majority voting to amend some provisions in our certificate of formation and bylaws; •authorize the issuance of “blank check” preferred stock and common stock that our board of directors could use to implement a shareholder rights plan or issue other shares of preferred stock or common stock, including blockchain tokens; •provide that only our Chief Executive Officer, the chairperson of our board of directors, a majority of our board of directors, or the holders of not less than 50% of the voting power of our shareholders will be authorized to call a special meeting of shareholders; •provide that, in certain circumstances, any shareholder action by written consent must be unanimous; •prohibit cumulative voting; •provide for a dual class common stock structure in which holders of our Class B common stock have the ability to control the outcome of matters requiring shareholder approval, even if they own significantly less than a majority of the outstanding shares of our Class A common stock and Class B common stock, including the election of directors and significant corporate transactions, such as a merger or other sale of our company or its assets; •provide that the board of directors is expressly authorized to make, alter, or repeal our bylaws; and •provide for advance notice requirements for nominations for election to our board of directors or for proposing matters that can be acted upon by shareholders at annual shareholder meetings.
Risk factors / charter restrictions and dual-class voting control · Filed 12/02/2026
The Board of Directors believes that it is currently in the best interest of Coinbase and its shareholders for Brian Armstrong to serve in both roles.
Governance / combined chairman and CEO roles · Filed 24/04/2026
The Restructuring involved a reduction of the Company's workforce by approximately 700 employees, and was substantially completed during the second quarter of 2026.
Restructuring / workforce reduction substantially completed · Filed 30/07/2026
As of June 30, 2026, we have not experienced excessive redemptions or withdrawals, or prolonged suspended redemptions or withdrawals, of crypto assets to date.
Liquidity / absence of excessive or prolonged suspended withdrawals · Filed 30/07/2026
For the three months ended March 31, 2026 as compared to 2025, Trading Volume decreased primarily reflecting a decrease of 44% in global crypto market spot trading volume (the USD equivalent value of all matched trades transacted between buyers and sellers across all exchanges) driven by softer market conditions.
MD&A / first-quarter global spot-market contraction · Filed 07/05/2026
•Market share — Trading Volume growth outpaced the 105% growth in overall U.S.
MD&A / reported trading-volume growth versus U.S. spot market · Filed 13/02/2025
spot market trading volume, as we were able to capture a larger portion of the trading activity due to our competitive position and product strategy.
MD&A / issuer explanation of market-share gains · Filed 13/02/2025
Other contractual obligations As of December 31, 2025, our other material contractual obligations consisted of the following (in thousands): Amounts Due Next 12 Months Total Non-cancelable purchase obligations(1) $ 169,886 $ 670,422 Operating leases(2) 32,547 417,873 Other commitments(3) 180,493 180,493 _______________ (1) Committed spend for non-cancellable purchase obligations greater than $2.0 million per obligation, primarily relating to technology.
MD&A / actual contractual purchase, lease and acquisition commitments · Filed 12/02/2026
Net cash provided by operating activities decreased by $712.7 million for the six months ended June 30, 2026 as compared to 2025 primarily as a result of the $726.8 million decrease in total consumer, net transaction revenue.
MD&A / operating cash-flow deterioration · Filed 30/07/2026
