Coinbase Prediction Markets Top $200 Million Annualized Revenue as Q3 Revenue Holds Steady

New revenue streams as crypto trading cools

Coinbase’s prediction markets business has passed $200 million in annualized revenue, giving the exchange a fast-growing source of income as crypto trading slowed. That figure points to a business with momentum, though annualized revenue is a run rate rather than a report of what the product actually earned over a full year. The company also reported a 24% year-over-year increase in paying Coinbase One members, who reached a record high. Together, the figures show the company trying to broaden its revenue base beyond transaction activity, which can shift sharply with market conditions. Coinbase released the numbers Oct. 29 in its third-quarter results.

There’s a notable gap between the quarter’s headline profit and its adjusted figure: Coinbase reported $719 million in net income and $78 million in adjusted net income. CFO Alesia Haas told the company’s earnings presentation that net income was “driven largely by unrealized gains on crypto assets that we hold for investment.” Those gains can lift reported earnings without reflecting cash generated by the company’s operating businesses during the quarter. That distinction matters when judging whether a result signals improving day-to-day performance or a change in the value of assets Coinbase holds. The company had recorded a $359.5 million net loss in Q2, according to its earnings deck.

Prediction markets broaden beyond sports

Coinbase says prediction-market revenue has grown at an 82% compound quarterly rate since launch. Daily traders increased more than 60% from Q2, and over half of contracts traded in Q3 were outside sports, Haas said. The shift beyond sports is useful evidence that the product may appeal to people interested in a wider range of outcomes, though the figures don’t show how much revenue each category contributes. Nor does a rapid growth rate on its own reveal how large or durable the business will become. Still, activity is expanding across more than one kind of contract, which gives Coinbase a stronger case for treating prediction markets as a developing product line rather than a narrow experiment.

CEO Brian Armstrong called prediction markets one of the fastest-growing products by revenue in the company’s history. He also said Coinbase had received CFTC approval to list its own contracts, which he expects to improve the business’s economics. That could give the company a different role in the market: alongside offering access to contracts, it could list products of its own. The reported approval and Armstrong’s expectation point to a possible change in the business model, but the earnings figures don’t yet quantify the financial effect. For now, the key claim is that the company sees room to grow both participation and the economics attached to it.

This is more significant than it looks: a prediction product can add activity that doesn’t depend on a customer buying or selling crypto at that moment. If you’re working in this space, the mix of rising daily traders and contracts outside sports is a signal to watch alongside the revenue headline. More varied activity could help a product remain relevant across different interests, but sustained use will matter more than launch-period growth. The latest figures give Coinbase evidence of demand; they don’t establish how that demand will hold up through changing market conditions.

Coinbase One has added subscribers for five consecutive quarters, including through difficult market conditions, Armstrong said. Members generate 3.5 times the average revenue per user and hold balances 4.2 times higher than nonmembers, according to the company. Those figures suggest that the subscription program is associated with deeper customer engagement and more valuable accounts. They don’t, by themselves, show whether membership causes customers to trade or hold more, or whether customers who were already more active are more likely to subscribe. Either way, Coinbase is presenting the program as a way to build recurring relationships that could soften the effect of slower trading.

Trading softness leaves revenue flat

“The market backdrop was challenging, but the business is healthy,” Haas said. A 10% decline in crypto trading volume across the market left Coinbase’s revenue largely unchanged at $1.2 billion. Its share of crypto trading volume climbed for a fourth straight quarter, reaching 10.7%. Holding revenue steady while the broader market contracted suggests Coinbase gained ground against other venues or retained more activity than the market as a whole. But a larger share doesn’t mean the underlying market is expanding, and flat revenue shows the limits of that gain in a weaker quarter. Here’s the thing: market share and company growth tell different stories.

Adjusted EBITDA was $333 million, up 60% from Q2 and positive for a 15th consecutive quarter. Management also reduced its 2026 adjusted expense forecast to between $4.15 billion and $4.3 billion. The higher quarterly figure indicates an improvement from Q2 on this measure, while the expense forecast gives investors a view of management’s current cost expectations. Adjusted EBITDA excludes items that affect reported net income, so it should be read alongside the gap between Coinbase’s reported and adjusted profit. The company’s results therefore offer two separate signals: operating performance improved from the prior quarter on one measure, while headline earnings were heavily influenced by unrealized gains.

Subscriptions and services—which include stablecoin income, staking rewards and lending—generated $570 million, up 3% from the prior quarter and equal to 49% of net revenue. Average USDC balances across Coinbase products reached a record $22 billion. The mix suggests these recurring businesses are helping cushion the effect of weaker trading activity. It also gives the company more than one way to earn from customers who use its products between trades. That matters when transaction revenue is exposed to shifts in market volume. Still, the categories cover several different activities, so the combined total doesn’t reveal which ones are driving growth or how evenly revenue is distributed across them.

What the results say about Coinbase’s next phase

Coinbase’s quarter shows a company trying to make its business less dependent on crypto trading volume. Prediction markets, subscriptions and services all contribute to that effort, while the increase in trading share indicates the exchange is still competing for its core activity. And yet, the results don’t erase the basic volatility of the business: revenue was largely unchanged as market trading fell, and reported profit benefited from gains on assets Coinbase holds. The company has added sources of activity, but the financial weight and staying power of each will take more quarters to assess.

For readers tracking the shift, the useful question isn’t simply whether prediction markets can grow quickly. It’s whether they can keep attracting traders, broaden their appeal beyond sports and contribute revenue as trading conditions change. Coinbase One’s subscriber gains and the scale of subscriptions and services provide another test: recurring customer relationships need to keep translating into meaningful business results. The quarter offers encouraging signs on those fronts, but the company’s own figures also show why it’s too early to treat a fast-growing run rate as proof of a settled new earnings engine. A promising mix. Still a work in progress.

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