CEO of Coinbase, the leading US cryptocurrency exchange Brian Armstrong In a statement on Tuesday, he explained that investors need to rally because the crypto winter could last another 12 to 18 months.
In a new interview with CNBC, Armstrong hoped the bear market would end within the timeframe he specified, while also making comments implying that the largest US crypto exchange is preparing for an even more sweeping decline.
“We all crypto winterWe’re hoping it will take 12 to 18 months, followed by a nice recovery, but obviously you should also have a plan for going longer than that. There are possibilities of such extension in our plans as well. The facts are there, we do not intend to be much more optimistic about the future.”
coinbase Reminding that his company has successfully survived the crypto falls four times in 10 years, Armstrong also stated that they are ready for the worst conditions until better days come.
“If we don’t get distracted and keep making great products, we’re going to do well in the next five or 10 years.”
He noted that while most of the company’s revenue is tied to trading volumes on the crypto exchange, Coinbase is increasingly moving its business towards what it calls “subscriptions and services” that can help bring more consistency to the company’s financials. Subscriptions and services now account for 18% of the company’s revenue.
Adding that he wants to move towards a business model where more than 50% of the company’s revenue is subscription and services, Armstrong gave clues about his future plans.
While the company’s fourth-quarter revenue last year increased more than 300% year-over-year and its expectations increased by more than half a billion dollars, Coinbase missed analyst expectations in both the second and first quarters of 2022 with year-over-year net income falling 60% and 27%, respectively.
Armstrong said that in light of the recent setbacks brought by the crypto winter, the company is cutting costs in marketing, external vendors and Amazon Web Services. The company also laid off about 1,100 people, or 18% of its workforce, in June as it sought to cut staff costs.
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